Stacey H. Chen, Jennjou Chen, Hongwei Chuang, Tzu-Hsin Lin
We study the role of medical knowledge versus professional networks in treatment choices and patient survival, using medical specialty variation among specialists and physician-patients with advanced cancer. We control unobserved doctor quality by matching comparable patients by attending doctors and admission periods. Compared to nonphysician-patients, physician-patients are less likely to have surgery/radiation/checkups and more likely to receive targeted therapy, spend more on drugs, and enjoy higher survival while spending less on coinsurance. The effect of professional networks explains some but not all patterns, leaving medical knowledge mechanisms to play a key role. Possessing a network equates to medical knowledge reduction for physician-patients with little medical knowledge of their cancers.