Pandemic shock and technology replacement: evidence from EMR data on high-end medical treatment India

New technology adoption is driven by a troika – demand-pull, technology-push, and institutions shaped by market and non-market forces. In technologically laggard countries, often this process is slowed due to frictions arising from the fact that the new technology has to replace an established older technology. In this paper, we exploit the COVID-19 pandemic shock to examine how intraorganization technology replacements occurred due to concurrent shifts in the demand and the supply side. Specifically, we focus on the adoption of a highend medical technology, Optical coherence Tomography Angiography (OCTA), by ophthalmologists to diagnose prevalent eye diseases – replacing less costly and older technology OCT. We use novel Electronic Medical Records (EMR) data from one of the largest eye-care hospital chains in India that treats both non-paying and paying patients with a not-for-profit orientation. In a differencein-differences setup, we consider non-paying patients as the treatment group and paying patients as the control group. We find that visual acuity among the pool of non-paying patients worsened during lockdown. Demand-pull generated through increased impairment propelled OCTA adoption by 21.6% points, predominantly facilitated through technology-push by young physicians. Higher adoption of OCTA, in turn, contributed to improving the eyesight of the non-paying patients. Our results go through various robustness checks and we conclude discussing the managerial and policy implications of our findings.