Results
Transaction costs: search and information costs
Fan [5] emphasized that in real life, information is usually incomplete and there are costs for complete information. Therefore, “incomplete information” and “search and information costs” are causally related. In transactions and negotiations, all parties attempt to maximize their profits by gaining sufficient information, which costs considerable time, energy, and money, or in other words, transaction costs. Solomon [9] suggested that consumers facing consumption-related problems require assistance from related information for the decision-making process and the search for such information could be referred to as search costs.
#1:41-50:S2 (Participant 1 discussing the temporal costs of searching and gathering information in lines 41–50 of the transcript)
“So how much time would you spend to make sure the information is correct?”
“About half an hour.”
“You’d spend half an hour checking it and then you would go to the clinic, right?”
“Right.”
#11:1-3:S3
“What, in your opinion, are the costs of medical advice-seeking behaviors?”
“Looking up a clinic, registration fees, and waiting times. Before going to see a doctor, I usually prepare myself by making a mental list of my symptoms so that I can readily consult with the doctor and see how I can be cured quickly.”
Transaction costs: negotiation costs
Liao [7] proposed that asymmetry in market information coupled with limited rationality and parties engaging in transactions are often unrelated, can foster distrust between the parties that necessitates negotiation, and costs both parties more time, energy, and money. These are negotiation costs.
#9:1-1:B2
“What, in your opinion, are the costs of medical advice-seeking behaviors?”
“Registration fees and time.”
#6:1-1:B3
“What, in your opinion, are the costs of medical advice-seeking behaviors?”
“Registration fees, transportation time, carfare, and waiting time.”
#8:3-5:B4
“Speaking of transportation, if you go to see a doctor by riding a scooter, the cost is the fuel cost, and if you go by mass transportation, then it’s the carfare. Oh, yes, and the registration fee, too.”
#12:2-6:B5
“Suppose I have to make an appointment with a doctor. I may have to sacrifice part of my working time or school time. If it’s working time, then it will affect my income. When it comes to money, the costs also include transportation fees and fees for treatment like registration fees.”
Transaction costs: decision-making costs
Mutual trust can lower the information searching costs incurred by both parties on acquiring the transaction opportunity. Negotiation costs can be flexibly reduced when both parties are willing to make concessions based on expectations of future gains from each other [8].
#3:7-11:D1 Decision-making costs: Trust (of people, medical institutions, and treatment)
“So why did you choose that clinic?”
“Because it was close to my place.”
“Locational advantage?”
“Yes.”
“Was there any reason other than locational advantage? Like, maybe you find that doctor trustworthy?”
“That doctor has always been very gentle to patients, which puts you at ease, and he has always been very patient, too.”
“So, simply put, you have grown to trust that doctor.”
“Right, I trust him.”
#5:18-25:D2 Decision-making costs: Habits
“So you are from Tainan? Do you habitually go to the same clinic or doctor when you are in Tainan?”
“Yes, there is one, and I always go there unless it is not open that day.”
“Is there a reason that you choose this particular clinic or this particular doctor?”
“Because I have been going there since I was little. Also, I find the treatment and the medicine the doctor gives me very effective. Usually, I only have to make one appointment and then I’m cured, unless I’ve got a really bad cold. In that case, I’d usually be cured after the second visit. In addition, I trust that doctor, and there has never been any trouble with him regarding the doctor–patient relationship.”
“So, you are used to that clinic and you trust them?”
“Yes, and I have a very high opinion of them.”
#14:10-11:D3 Decision-making costs: Consultation (expertise)
“What if you are seriously ill and the doctor at the clinic is unable to cure you?”
“My doctor will refer me to another specialist. He will write a referral letter for me.”
Transaction costs: policing costs
Two types of uncertainty are inherent in transactions, both of which can increase policing costs. The first consists of predicable or unpredictable chance events induced by limited rationality and the second is uncertainty in insufficient information rendered by withholding, falsification, or distortion [10].
#2:70-73:M1
“So, would you feel worried… I mean, after seeing this doctor, would you still feel worried and seek a second opinion?”
“Yes.”
“Does that mean you still fear the doctor may make an inaccurate diagnosis?”
“Yes. If I am cured with no trouble, then I won’t be worried, but if the sickness persists, I will surely have doubts.”
#10:68-74:M2
“Would you, for example, search for information online first if you feel very sick and have symptoms that you have never experienced before?”
“Yes, I would search for information on the Internet.”
“What if you find your situation to be kind of different from the doctor’s diagnosis, or even in conflict with it? Which side will you take when that happens?”
“I will show the information to the doctor. I mean, I will show it to him and tell him that it seems to contradict what he said, and then ask him to explain it to me. If his explanation makes sense to me, then of course I will follow his instructions; otherwise, I will go to another clinic for a second opinion.”
#15:33-40:M3
“Since you just mentioned that you habitually go to the same clinic whether you are in Taipei or in Miaoli, do you also look for medical advice from other sources?”
“Do you mean the Internet, or any source?”
“Newspaper supplements for example; some people who want to lose weight may follow a diet regime they found in a supplement. Some people with gynecological problems will try traditional Chinese medicine to ‘strengthen the body’ in addition to going to a gynecologist. If you don’t have full confidence in this doctor, you may want to get a second opinion from another doctor and compare what they have to say. Do you do such things?”
“I do. I will check what is good for my situation.”
“So you have no problem with traditional Chinese medicine or things like food therapy?”
“That’s right.”
Transaction costs: contract execution costs
After a contract has been agreed upon, both parties must verify whether the other has fulfilled the
terms of the contract, and in the event of noncompliance, enforce the terms. The costs that ensure the execution of a contract are contract execution costs. Upon completion of a contract, both parties may choose to renew their transaction or one may choose to relinquish their part of the agreement to another partner, in which case, the costs incurred are switching costs [3].
#1:61-69:E1
“Would you still feel worried after seeing the doctor? Like, maybe sometimes you will want to see another doctor or conduct an online search of the medicine the doctor prescribed.”
“I’d only worry about the side effects.”
“You mean harm to the body from side effects or failed therapy?”
“Yes.”
“So, in the face of uncertainty, would you look up information on the medicine prescribed or maybe even stop taking it altogether?”
“I think I would visit another doctor.”
“Do you mean you would counter the uncertainty by changing to another doctor?”
#7:81-87:E2
“What would you do if it turned out that the mole removal had failed?”
“I think I would be very angry.”
“What else?”
“If they dare ask me to give them a rating, I’d give them the worst one and demand compensation.”
“Would you go back to them for remedial measures?”
“No. I’d change to another clinic.”
“You’d switch clinic?”
“Of course, it’s for my face after all.”
“Suppose the original clinic offers method A for mole removal and the clinic you intend to switch to offers method B. Would you still want to switch to the new method?”
“I suppose I would. The old method has failed anyway, so why not give another method a try? Yes, I would try it. I would be open to anything that could solve the problem.”
#3:39-44:E3
“Would you be worried if the doctor asked you whether you are allergic to anything or feel uncomfortable about taking certain medicines? Would you perhaps worry that the doctor may overlook certain small things at your expense; for example, giving you unsuitable medicine without making sure you aren’t allergic to it?”
“Not at all.”
“Would you change therapy if you felt uncomfortable after taking the medicine? Would you switch treatments or even switch to another clinic?”
“Yes, if that happened I would.”
Discussion
The interview transcripts indicate that there is a tight relationship between transaction cost theory and medical-seeking behavior. Although, the public has only a weak conception of transaction costs. The transcripts, traces of understanding of transaction costs can be detected in relation to medical advice-seeking behaviors. Most of the discernable elements corroborate the findings of Dahlman [3], including search and information costs, negotiation costs, policing costs, and contract execution costs.
Transaction assets
In addition to transaction costs, another factor tentatively referred to as transaction assets has been mentioned repeatedly. This factor may be accumulated at the expense of multiple costs and may facilitate the reduction of future costs. The possession of transaction assets can effectively reduce transaction costs and such assets may be the result of trust, habits, and connections. Experienced people tend to rely on such assets to effectively reduce transaction costs, or in other words, obtain access to equal or preferential medical treatment; for example, some participants stated that they need not spend much time searching for clinics when at home because they are already acquainted with local physicians. However, after leaving home for further education or work, people must spend more time or use connections to build up trust. Therefore, transaction assets can be understood as reducing search and information costs, negotiation costs, policing costs, and contract execution costs.
Minor and serious illnesses
Generally, when faced with familiar symptoms, people tend to seek medical advice from medical institutions that incur lower transaction costs such as those that are closer to home, charge less, or do not have long waiting times. By contrast, when faced with unfamiliar symptoms, people feel inclined to incur higher search and information and negotiation costs to prevent the illness from developing beyond their control, thereby ultimately incurring higher policing and contract execution costs.
