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dc.contributor.author McCarthy, Ian
dc.contributor.author Tchernis, Rusty
dc.date.accessioned 2008-04-10T14:00:48Z
dc.date.available 2008-04-10T14:00:48Z
dc.date.issued 2008-04-03
dc.identifier.uri http://ssrn.com/abstract=1116253 en
dc.identifier.uri http://www.iub.edu/~caepr/RePEc/PDF/2008/CAEPR2008-004.pdf en
dc.identifier.uri http://hdl.handle.net/2022/3114
dc.description.abstract There is increasing evidence suggesting that Medicare beneficiaries do not make fully informed decisions when choosing among alternative Medicare health plans. To the extent that deciphering the intricacies of alternative plans consumes time and money, the Medicare health plan market is one in which search costs may play an important role. To account for this, we split beneficiaries into two groups--those who are informed and those who are uninformed. If uninformed, beneficiaries only use a subset of covariates to compute their maximum utilities, and if informed, they use the full set of variables considered. In a Bayesian framework with Markov Chain Monte Carlo (MCMC) methods, we estimate search cost coefficients based on the minimum and maximum statistics of the search cost distribution, incorporating both horizontal differentiation and information heterogeneities across eligibles. Our results suggest that, conditional on being uninformed, older, higher income beneficiaries with lower self-reported health status are more likely to utilize easier access to information. en
dc.format.extent 298428 bytes
dc.format.mimetype application/pdf
dc.language.iso en_US en
dc.publisher Center for Applied Economics and Policy Research en
dc.relation.ispartofseries CAEPR Working Papers en
dc.relation.ispartofseries 2008-004 en
dc.relation.isversionof This paper is also available on SSRN and RePEc. en
dc.subject CAEPR en
dc.subject Center for Applied Economics and Policy Research en
dc.subject Search en
dc.subject Medicare Health Plan Choice en
dc.subject Discrete Choice Models en
dc.subject Bayesian Methods en
dc.subject Consumer Search en
dc.subject Econometrics en
dc.title Search Costs and Medicare Plan Choice en
dc.type Working Paper en


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