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Estimating the Effects of Global Patent Protection in Pharmaceuticals: A Case Study of Quinolones in India

Author

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  • Panle Jia
  • Pinelopi K. Goldberg
  • Shubham Chaudhuri

Abstract

Under the Agreement on Trade-Related Intellectual Property Rights, the World Trade Organization members are required to enforce product patents for pharmaceuticals. In this paper we empirically investigate the welfare effects of this requirement on developing countries using data for the fluoroquinolones subsegment of the systemic anti-bacterials segment of the Indian pharmaceuticals market. Our results suggest that concerns about the potential adverse welfare effects of TRIPS may have some basis. We estimate that the withdrawal of all domestic products in this subsegment is associated with substantial welfare losses to the Indian economy, even in the presence of price regulation. The overwhelming portion of this welfare loss derives from the loss of consumer welfare. (JEL F13, L65, O34)

Suggested Citation

  • Panle Jia & Pinelopi K. Goldberg & Shubham Chaudhuri, 2006. "Estimating the Effects of Global Patent Protection in Pharmaceuticals: A Case Study of Quinolones in India," American Economic Review, American Economic Association, vol. 96(5), pages 1477-1514, December.
    • Handle: RePEc:aea:aecrev:v:96:y:2006:i:5:p:1477-1514
    Note: DOI: 10.1257/aer.96.5.1477
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    More about this item

    JEL classification:

    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

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