Marginal effects of physician coverage on infant and disease mortality

This paper investigates the effect of changes in the physician coverage ratio on infant mortality, perinatal mortality and the incidence of common childhood diseases. We utilize historical data and variation in the regional physician density provided by discriminatory policies in Germany in 1933, when Jewish physicians were expulsed from health insurance schemes and subsequently emigrated in large numbers. The results indicate substantial health effects. One additional physician per 1,000 of population reduces infant mortality by 23% and perinatal mortality by 16%. We find similar negative effects for gastrointestinal diseases, stillbirths and the incidence of measles, influenza and bronchitis. Using a semiparametric control function approach, we demonstrate that the marginal returns to coverage are nonlinear and decreasing. A coverage ratio of two physicians per 1,000 of population is sufficient to prevent mortality effects in the population.