Discerning the Effects of Recent Private Health Insurance Policy Changes in Australia

The Australian government implemented several new policy initiatives during 1997--2000, with the stated aim of raising the take-up rate of private health insurance. Taken together, these policy initiatives were quite effective, the proportion of the population with private health insurance cover increased by more than 35\%. However, much less clear is the effectiveness of different components of the policies, due to their sequential implementation. Since there are large cost differences in implementing these policies, an understanding of the effects of each policy is important for policymaking. This paper attempts to isolate the effects of different policies using the 1995 and 2001 National Health Survey data. The two datasets allow the estimation of private health insurance demands before and after the policy changes. The results were used to perform a counterfactual analysis of what would have happened had there been no new policies. Further, utilizing the age-specific aspect of Lifetime Health Cover, we are able to isolate its contribution to within 42\% and 75\% of the increase in private health insurance membership.Health Insurance Demand; Public Policy

Patent Examination Decisions and Strategic Trade Behavior

This paper examines whether strategic trade behavior can explain the fact that the US, Japanese and European Patent Offices – the USPTO, the JPO and the EPO – often make different decisions about whether to grant (or reject) a given patent application. We analyse this issue by considering whether examination decisions across the patent offices vary systematically by inventor nationality, patent quality and technology area using a matched sample of 33,305 non-PCT patent applications granted by the USPTO and subjected to examination decisions at the EPO and the JPO.

Essays on the implications of firm behaviors in learning, locating, and advertising

This dissertation addresses three topics on the implications of firm behaviors in creating and adopting knowledge of production, choosing international location for production and market access, and using informative advertising in a market competition with multidimensional product characteristics. The first study investigates the empirical evidence of local knowledge spillovers in Indonesian medium and large manufacturing industry. The second study looks at the link between the patterns of trade revealed comparative advantage and net inward foreign direct investment in five developed countries: France, Italy, Japan, the United Kingdom, and the United States. The third study seeks to determine the effects of informative advertising in a market with two-dimensional, vertically differentiated products. The results of the first study show that the extent of knowledge spillovers depends on both geographical and technological proximities. In addition, the extent of knowledge spillovers seems to depend on sector-specific characteristics and the presence of foreign investment. The results of the second study reveal a significant role of comparative advantage in determining inflows of foreign direct investment in developed countries, especially in the services industry. Finally, the results of the third study show that with informative advertising, the firm with the 'better' product will charge a higher market, have a larger market share, and advertise more. In addition, even when advertising leads to higher market prices, the full-prices that the consumers must pay are still lower than in the case of no advertising

A two-stage estimation of hospital performance using mortality outcome measures: an application using Victorian hospital data

This paper proposes a method of deriving a hospital quality performance indicator using mortality outcome measures. The method aggregates any number of mortality outcome measures observed over several years into a single indicator. The paper begins with the supposition that there exists an abstract quality index which drives all observed mortality outcomes in each hospital. This abstract index is not directly observable but manifested via the observed mortality outcomes, which the authors make use of to provide an estimate of the abstract index. The method is applied to a sample of heart disease episodes extracted from hospital administrative data from the state of Victoria, Australia. Using the quality estimates, the authors show that teaching hospitals and large regional hospitals perform better than other hospitals and this superior performance is related to hospital size

The effect of raising the Australian statutory inventive step on the Australian global production system

This paper analyses the effect of raising the inventive step requirements in the Patents Act 1990 on Australia?s position in the global supply chain. In particular, it considers the likely effects on the intentions of foreign multinational enterprises (MNEs) to invest in Australia and the ability of Australian businesses to compete in the global market. The authors provide a brief background discussion on the nature of global production, that is, what determines whether an MNE will choose to undertake foreign direct investment in Australia and the factors determining the revealed inventive step. For each affected party ? domestic inventors, foreign MNEs and rivals of these two groups ? theyconsider the likely effects on behaviour under four sets of stylised circumstances

Patent Application Databases

The article reports on the patent application databases. It cites that patent systems are used to stimulate investment into innovative activity. It mentions that the patent is the most recognized means for legal protection in which inventors mostly keep their inventions secret or apply for patent to keep away from competitors or imitators. It highlights an outline scope of databases in several trilateral patent offices including in the U.S., Japan and Europe

Trade liberalisation, exit, and output and employment adjustments of Australian manufacturing establishments

This paper investigates three potential sources of Australia's manufacturing productivity gains from trade liberalisation in the mid-1990s: the exit of inefficient establishments, economies of scale, and the reduction in x-inefficiency via employment reduction. We use manufacturing establishment level data and exploit the intersectoral variation in the effective rates of assistance (ERA) to see how businesses adjusted to trade liberalisation during the period. We find the documented productivity gains to be mostly accounted for by the reduction in x-inefficiency through employment shedding in industries experiencing a high degree of trade liberalisation. We find little evidence that the exit of inefficient establishments in highly liberalised industries contributes to productivity gains. In fact, we find that the more productive establishments are more likely to exit, perhaps reflecting product switching by these businesses to make more profitable use of inputs. Similarly, there does not appear to be a strong relationship between the extent of trade liberalisation and output adjustments. However, we do find indicative evidence of an overall productivity-enhancing effect through economies of scale. These findings suggest that, at least for the case of Australia, the ease of making employment adjustments can be crucial for policies such as trade liberalisation to have the desired effect. In addition, trade liberalisation may provide incentives for domestic producers to seek more profitable use of their inputs and to move further downward along their cost curves. We think further studies assessing the productivity gains from product switching and economies of scale effects in both liberalised and non-liberalised industries and focusing on the interplay between labour market policy and firm adjustments would be valuable

Parallel imports, market size and investment incentive

This paper proposes a vertical control model that features two-part tariff pricing, leader-fringe-follower competition, and investment to characterize the conditions under which parallel imports will (or will not) occur when such activities are legally permitted. In addition, we analyze the effects of parallel imports on the incentive of an authorized distributor to invest in market development. We find that parallel imports cannot arise if the target and the source market either differ too greatly or are too similar in size. Two results are worth emphasizing. First, parallel imports can arise even if the IP owner has the ability to deter parallel imports. Second, the presence of parallel imports and even the threat posed by parallel imports can reduce the domestic distributor's market development investment

Exporter and Non-Exporter Productivity Differentials: Evidence from Australian Manufacturing Establishments.

We study the link between exporting and productivity using unpublished establishment level data of the Australian manufacturing from 1994 to 2000. We find there is significant difference in the first moment as well as the whole distribution of productivity between exporters and non-exporters. At the mean level, the average productivity differentials between Australian exporters and non-exporters are comparable to that of, for examples, the United States, Germany, or Taiwan. More importantly, as also found in almost all other countries, we find that the bigger and more productive firms appear to self-select into the export market. In addition, we also find that a higher intensity and longer period of export market exposure is associated with a higher level of productivity, indicating a possible learning-by-exporting effect. JEL Classification: D21; F21Productivity; Exports, Australia; Manufacturing; Establishment; Exit; Employment.

How effective is “lifetime health cover” in raising private health insurance coverage in Australia? An assessment using regression discontinuity

The Australian government introduced three major private health insurance policy initiatives in recent years. These are, in chronological order, (i) the Private Health Insurance Incentives Scheme (PHIIS), which imposes a tax levy on high-income earners who do not have private health insurance and provides a means-tested subsidy schedule for low-income earners who purchase PHI; (ii) a 30% premium rebate for all private health insurance policies to replace the means-tested component under PHIIS; and (iii) lifetime health cover, which permits a limited form of age-related risk rating by insurance funds. Together, these policy changes have been effective in encouraging the uptake of PHI; the percentage of the population covered by PHI rose from 31% in 1999 to 45% at the end of 2001. The difficult issue, however, is in disentangling the effects of the three policy changes, given that they were introduced in quick succession. This article attempts to evaluate the effect of lifetime health cover using a regression discontinuity design, an approach that makes use of cross-section data that allows the effect of lifetime health cover to be isolated via local regression. The results suggest that the importance of lifetime health cover appears to be grossly over-rated in previous studies. Our estimates indicate that it accounts for roughly 22-32% of the combined effects of all the policy initiatives introduced in the late 1990s. While these figures suggest that its effect is clearly significant, it is nonetheless nowhere near the effect often associated with lifetime health cover.