Soft Budget Constraints in China: Evidence from the Guangdong Hospital Industry
Journal ArticleAuthors
Karen Eggleston, Yu-Chu Shen, Mingshan Lu, Congdong Li, Jian Wang, Zhe Yang
Published by
International Journal of Healthcare Finance and Economics, Vol. 9 no. 2, page(s) 233-42
2009
Using data from 276 general acute hospitals in the Pearl River Delta region of Guangdong Province from 2002 and 2004, we construct a preliminary metric of budget constraint softness. We find that, controlling for hospital size, ownership, and other factors, a Chinese hospital’s probability of receiving government financial support is inversely associated with the hospital’s previous net revenue, an association consistent with soft budget constraints.
Topics: Economics | Health care institutions | China



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