Identification of Supplier-induced Demand. What kind of consumer information matters?

The focus of the present study is on consumer health information in relation to supplier induced demand (SID). We argue that previously used measures of consumer health information are not suitable to identify SID. Using a new information measure based on questions of the Swiss Health Survey, we estimate a Poisson hurdle model for office visits. We find that information has a negative effect on health care utilization, thus providing evidence for the SID hypothesis.