PROJECTS

Investigation Into Possible Anti-Competitive Impact Medical Association Practices, New Zealand

The problem

New Zealand’s Commerce Commission was worried that professional medical associations were undermining competition in specialist medical fields. Associations control the admission of specialist doctors through examinations and other requirements. Castalia’s expert testimony had helped the Commission win a High Court case against the professional association representing ophthalmologists. The Commission was concerned about other medical associations, but had no way of detecting anti-competitive behavior in admissions practices.

How we helped

Castalia devised questions about admissions practices for the Commerce Commission to ask. The answers would identify practices that limited competition. We developed a counterfactual of market entry pathways with no unjustified barriers. For each pathway, we identified the barriers that medical associations might impose to reduce competition.

Impact

Castalia’s questions helped the Commission to distinguish between quality-based entry restrictions and competition-limiting barriers. Our methodology allowed the Commission to conclude that other medical associations were not using admissions practices to reduce competition.