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76 sats \ 2 replies \ @Undisciplined 10 Jul \ parent \ on: Dodge Momentum Index Slows 2% in June - Dodge Construction Network Construction_and_Engineering econ

They don't find net negative. They find no significant impact and this is monitoring the local mortality statistics after a hospital either opens or closes in the area, so it should have no impact on how many people need to be admitted to a hospital, unless you think hospitals create their own demand somehow.

If anything, entry and exit of hospitals would be in response to local need, which would lead to an overly positive estimated impact due to selection bias.

My guess is that the lack of an observed effect comes down to four things:

  1. People usually get better on their own but attribute getting better to the treatment they receive (post hoc ergo proctor hoc)
  2. Hospitals are a source of two leading causes of death (doctor and pharmacist error)
  3. Hospitals provide diagnostics and symptom management more than remedies
  4. The most valuable hospitals have already been built and the returns to additional ones are very small.
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51 sats \ 1 reply \ @BlokchainB OP 10 Jul

#4 Makes a ton of sense.

unless you think hospitals create their own demand somehow.

Having a hospital exists and people know about it creates demand. Just think of a mother who rushes her child to the hospital everytime the kid has a slight fever. If the hospital doesn’t exist she doesn’t go. Maybe it’s a trip to CVS. The child recovers and the mental burden of a sick child is now alleviated.

If anything, entry and exit of hospitals would be in response to local need, which would lead to an overly positive estimated impact due to selection bias.

I would say a regional need. Hospitals provide higher levels of care that is justified by a large population set. Viewing the economic impact of hospital on death and errors made that lead to death I think ignores the overall objective of trying to keep people alive. And what that does for humans to take on more risks.

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153 sats \ 0 replies \ @Undisciplined 10 Jul
the mental burden of a sick child is now alleviated.

I didn't specifically mention peace of mind but that is part of what I was thinking about with item 3.

the overall objective of trying to keep people alive. And what that does for humans to take on more risks.

You're describing a moral hazard of expanded medical services and the implication is that the increase in risky behavior fully cancels out the gains in life-saving, which seems implausible to me unless the life-saving is very minimal.

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