I’ve always been interested in the dentists’ decision to support water fluoridation – one of the few examples of medicos campaigning for a policy change that really hurt their economic interests (unlike, for example, the Australian Medical Association, which among other things opposed the introduction of Medicare).
Now a new NBER working paper looks at how this affected dentists’ business. Here’s the abstract:
Equilibrium effects of public goods: The impact of community water fluoridation on dentists
by Katherine Ho, Matthew Neidell
In this paper we consider how the dental industry responded to the addition of fluoride to public drinking water. We take advantage of the staggered introduction of fluoridation throughout the country to analyze the changes in numbers of within-county dentists relative to physicians in the years surrounding the change in fluoridation status. We find a significant decrease in the number of dental establishments and an even larger reduction in the number of employees per firm following fluoridation. We also find that fluoridation in neighboring markets was associated with an increase in own-market dental supply, suggesting that dentists responded to the demand shock by moving from fluoridated areas to close-by markets. Further analysis suggests that some dentists may have retrained as specialists rather than moving geographically. Our estimates imply that the 8 percentage point change in exposure to water fluoridation from 1974 to 1992 may have led to the loss of as many as 0.6 percent of dental establishments and 2.1 percent of dental employees, suggesting a substantial net impact of this public good on the dental profession since its inception.
Presumably the drop was partially offset by aggressive marketing of other products, such as braces for children and whitening products for adults.