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We study a key part of National Health Service (NHS) policy to ensure high-quality health care: failure to supply such care cost the NHS £787m in clinical negligence payouts during 2009-10. The NHS uses risk management standards to incentivize care, and we examine their effects on methicillin resistant Staphylococcus aureus (MRSA) infections. Using a specially assembled data set, our GMM results suggest that improvements in the risk management standards attained by some hospitals are correlated with reductions in their MRSA infection rates. Moreover, the exogeneity of this relationship cannot be rejected for higher risk management levels, suggesting attainment of higher standards was instrumental in reducing infection rates. © Blackwell Publishing Ltd and the Department of Economics, University of Oxford, 2012.

Original publication





Oxford bulletin of economics and statistics

Publication Date





340 - 361