Resource dependence theory also emphasizes that most organizations may adopt new strategies or change their behaviors to reduce the degree of dependence on available resources (Pfeffer & Salancik, 1978). Existing empirical
studies have applied this theory to study different questions in health care industries. For example, Banaszak- Holl, Zinn, and Mor (1996) used this model to examine the impact of market and organizational characteristics on organizational innovation in nursing care setting. Alexander and Lemak (1997) used this framework to study whether managed care has effects on administrative burden in outpatient substance abuse treatment facilities.
Given our research questions, we apply resource dependence theory as the primary conceptual framework to study the impact of environmental factors on hospital efficiency and uncompensated care provision.