The Utilization of Competing Technologies Within the Firm: Evidence from Cardiac Procedures

This paper examines the role of technological status in determining the rates at which competing techniques are used within a firm. Consistent with prior studies, technological status is measured on the basis of an actor's prior contributions to the body of knowledge concerning a given technique. The empirical analysis considers two treatments for coronary artery disease (CAD), each of which is associated with a distinct professional group within a hospital. These two groups are often characterized as engaging in a "turf war" for patients. After controlling for several factors that might explain technological choice---the clinical severity of patients, the relative quality of the two procedures at a given facility, firm-level financial performance, and other firm-level characteristics---I find that the technological status of the group associated with each technique affects the relative rate at which it is used within a given hospital. Moreover, this effect is strongest for patients at the margin between the two techniques. These results suggest that viewing the choice between competing innovations as a single, firm-level decision may not always capture the true dynamics underlying such a situation.