Do responses to news matter? Evidence from interventional cardiology.
Daniel Avdic, Stephanie von Hinke, Bo Lagerqvist, Carol Propper, Johan Vikström
Author Information
Daniel Avdic: Department of Economics, Deakin University, 70 Elgar Road, Burwood VIC 3125, Australia. Electronic address: d.avdic@deakin.edu.au.
Stephanie von Hinke: School of Economics, University of Bristol, United Kingdom; IFS, United Kingdom.
Bo Lagerqvist: UCR and SCAAR Study Group, Uppsala, Sweden.
Carol Propper: IFS, United Kingdom; Imperial College Business School, Imperial College London, United Kingdom; Monash University, Australia; CEPR, United Kingdom.
Johan Vikström: IFAU, Sweden; Uppsala University, Sweden.
We examine physician responses to a global information shock and how these impact their patients. We exploit international news over the safety of an innovation in healthcare, the drug-eluting stent. We use data on interventional cardiologists' use of stents to define and measure cardiologists' responsiveness to the initial positive news and link this to their patients' outcomes. We find substantial heterogeneity in responsiveness to news. patients treated by cardiologists who respond slowly to the initial positive news have fewer adverse outcomes. This is not due to patient-physician sorting. Instead, our results suggest that the differences are partially driven by slow responders being better at deciding when (not) to use the new technology, which in turn affects their patient outcomes.
