We use Survey of Dental Practice data from 1983 to 2012 to examine market power of dentists and hygienists in private practice. Our findings are consistent with a dental market wherein practices use hygienist services as a “loss leader” in order to steer patients into more lucrative dental services, which exhibit the ability to markup price above marginal cost. Both dental care exhibits an elasticity of demand of roughly − 0.2, while hygienist care exhibits and elasticity of demand of nearly − 0.6. Another theme that emerged from our findings is the evidence for significant economies of scale in the dental market. The overall returns to scale parameter of 2.1 suggests significant increasing returns to scale are available to the typical dental practice. Given that the typical practice has 1.5 dentists, the finding is not surprising. While returns to scale diminishes with visit volume, the largest quartile of practices still has meaningful increasing returns to scale of roughly 1.75.

中文翻译：

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牙科行业的竞争和市场结构

我们使用1983年至2012年的“牙科实践调查”数据来检查牙医和卫生学家在私人执业中的市场力量。我们的发现与牙科市场一致，在该市场中，实践将卫生保健服务用作“亏损领先者”，以引导患者获得更有利可图的牙科服务，这些服务具有将价格加价至边际成本以上的能力。两种牙科护理都表现出大约-0.2的需求弹性，而卫生保健人员展现出几乎-0.6的需求弹性。我们发现的另一个主题是牙科市场规模经济的证据。总体规模收益参数为2.1，表明典型的牙科诊所可利用的规模收益显着增加。考虑到典型的做法是有1.5名牙医，这一发现不足为奇。