That’s the clever title of recient American Economic Review post by Cyrus Aghamolla, Pinar Karaca-Mandic, Xuelin Li, Richard T. Thakor. The summary is below.
This study examines the link between credit supply and hospital health outcomes. We use bank stress tests as exogenous shocks to credit access for hospitals that have lending relationships with tested banks. We find that affected hospitals change their operations to increase resource utilization following a negative credit shock, but reduce the quality of their patient care through a variety of measures, including a significant increase in readmission and mortality rates. risk-adjusted. The results indicate that access to credit can affect the quality of health care provided by hospitals, pointing to important indirect effects of credit market frictions on health outcomes.
You can read the full article. here.
