Labor supply decisions of US physicians revisited

Abstract

We specify a fully integrated model that describes, in a utility-consistent fashion, the interrelated decisions of young physicians who select medical school, medical specialty and location of practice. To date, studies in this area have employed mainly single equation models with little regard to the interrelation of physicians’ choice. We find that different combinations of medical school attended – medical specialty – location of practice subgroups within the profession are likely to respond to any one policy to affect decisions in a different fashion, and that policies aimed at achieving some target distribution of physicians across specialties and locations must be coordinated by taking into account possible discrepant effects on physicians’ interrelated choices that ultimately define the place and field of their practice