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Public and private entities around the world are trying to induce the provision of higher-quality health care by adopting institutional arrangements intended to promote competition among care providers. I selectively survey and supplement the literature to show that an increase in competition�modeled either as a larger number of care providers or greater precision of signals available to consumers regarding provider quality�may result in lower equilibrium quality, holding prices fixed. These findings are an indication that considerable opportunities exist for industrial organization theorists to contribute to our understanding of healthcare markets.
