EMERGENCY RESPONSE SERVICES: Conclusions

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From our analysis in this paper, we draw several conclusions which we hope will impact future research. First, our results highlight that emergency response systems play two distinct roles: productive and allocative. It therefore seems important to consider the potential bias which arises in studies which take allocation as exogenous or which do not account for the heterogeneity in county mortality rates which are induced by higher levels of pre-hospital care (such as lower response times or on-the-scene defibrillation). Further, the incentives generated by the pre-hospital system need to be taken into account when regulators and insurance companies consider creating additional incentives for hospitals. Our analysis highlights one particularly important feature of the pre-hospital system: it interacts with the incentives of hospitals to adopt new technologies and maintain highly rated emergency facilities.

Our reduced-form results can be extended to provide a more structural understanding of the interaction between the pre-hospital infrastructure and hospital competition. For example, we find that patients are allocated by the pre-hospital system according to their severity and the technology which a hospital employs (see Tables 11 and 12); it is left to future work to evaluate whether these allocative effects are reflected in terms of strategic investment behavior by hostpials.