Antibiotics are effective in treating bacterial infections. However, the excessive usage of antibiotics leads to the development of antibiotic resistant bacteria, which significantly reduces their effectiveness. Current strategies to address antibiotic resistance mainly target primary care physicians, who serve as the gatekeepers of antibiotic prescriptions in many countries. Therefore, it is crucial to understand the factors that affect their decision making. This study investigates market competition as a driver of physicians’ prescribing behavior in Denmark. Using a novel measure of competition, and employing clinic exit as instrumental variable, I find a significant and positive effect of competition on the prescriptions, indicating that high level of competition may lead to outcomes that are less socially desirable. The findings call for a better design of the primary healthcare market and more efficiently targeted policies for antibiotic prescribing.