IDEAS home Printed from https://ideas.repec.org/a/eee/jhecon/v30y2011i1p181-188.html
   My bibliography  Save this article

Designing the financial tools to promote universal access to AIDS care

Author

Listed:
  • Leoni, Patrick
  • Luchini, Stéphane

Abstract

We argue that reluctance to invest in drug treatments to fight the AIDS epidemics in developing countries is largely motivated by severe losses occurring from the future albeit uncertain appearance of a curative vaccine. We design a set of securities generating full insurance coverage against such losses, while achieving full risk-sharing with vaccine development agencies. In a General Equilibrium framework, we show that those securities are demanded to improve social welfare in developing countries, to increase current investment in treatments and the provision of public goods. Even though designed for AIDS, those securities can also be applied to other epidemics such as malaria and tuberculosis, as well as any innovative treatment to fight orphan diseases.

Suggested Citation

  • Leoni, Patrick & Luchini, Stéphane, 2011. "Designing the financial tools to promote universal access to AIDS care," Journal of Health Economics, Elsevier, vol. 30(1), pages 181-188, January.
    • Handle: RePEc:eee:jhecon:v:30:y:2011:i:1:p:181-188
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0167-6296(10)00139-6
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Michael Kremer & Christopher Snyder, 2004. "Why is There No AIDS Vaccine?," CID Working Papers 111, Center for International Development at Harvard University.
    2. Lasserre, Pierre & Moatti, Jean-Paul & Soubeyran, Antoine, 2006. "Early initiation of highly active antiretroviral therapies for AIDS: Dynamic choice with endogenous and exogenous learning," Journal of Health Economics, Elsevier, vol. 25(3), pages 579-598, May.
    3. Avinash K. Dixit & Robert S. Pindyck, 1994. "Investment under Uncertainty," Economics Books, Princeton University Press, edition 1, number 5474.
    4. Jean-Paul Moatti & Benjamin Coriat & Yves Souteyrand & Tony Barnett & Jérôme Dumoulin & Yves-Antoine Flori, 2003. "Economics of AIDS and access to HIV/AIDS care in developing countries : issues and challenges," Post-Print halshs-00112023, HAL.
    5. Michael Kremer & Edward Miguel & Rebecca Thornton, 2009. "Incentives to Learn," The Review of Economics and Statistics, MIT Press, vol. 91(3), pages 437-456, August.
    6. LeRoy,Stephen F. & Werner,Jan, 2014. "Principles of Financial Economics," Cambridge Books, Cambridge University Press, number 9781107024120, February.
    7. Palmer, Stephen & Smith, Peter C., 2000. "Incorporating option values into the economic evaluation of health care technologies," Journal of Health Economics, Elsevier, vol. 19(5), pages 755-766, September.
    8. Avinash Dixit, 2003. "Some Lessons from Transaction‐Cost Politics for Less‐Developed Countries," Economics and Politics, Wiley Blackwell, vol. 15(2), pages 107-133, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Fehr, Ernst & Fischbacher, Urs & Kosfeld, Michael, 2005. "Neuroeconomic Foundations of Trust and Social Preferences," IZA Discussion Papers 1641, Institute of Labor Economics (IZA).
    2. Armin Falk & Ernst Fehr & Christian Zehnder, "undated". "The Behavioral Effects of Minimum Wages," IEW - Working Papers 247, Institute for Empirical Research in Economics - University of Zurich.
    3. Tania Singer & Ernst Fehr, 2005. "The Neuroeconomics of Mind Reading and Empathy," American Economic Review, American Economic Association, vol. 95(2), pages 340-345, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Paolo Pertile, 2009. "An extension of the real option approach to the evaluation of health care technologies: the case of positron emission tomography," International Journal of Health Economics and Management, Springer, vol. 9(3), pages 317-332, September.
    2. Meyer, Elisabeth & Rees, Ray, 2012. "Watchfully waiting: Medical intervention as an optimal investment decision," Journal of Health Economics, Elsevier, vol. 31(2), pages 349-358.
    3. Paolo Pertile & Emanuele Torri & Luciano Flor & Stefano Tardivo, 2009. "The timing of adoption of positron emission tomography: a real options approach," Health Care Management Science, Springer, vol. 12(3), pages 217-227, September.
    4. Louberge, Henri & Villeneuve, Stephane & Chesney, Marc, 2002. "Long-term risk management of nuclear waste: a real options approach," Journal of Economic Dynamics and Control, Elsevier, vol. 27(1), pages 157-180, November.
    5. Rosella Levaggi & Moretto Michele, 2008. "Investment In Hospital Care Technology Under Different Purchasing Rules: A Real Option Approach," Bulletin of Economic Research, Wiley Blackwell, vol. 60(2), pages 159-181, April.
    6. Martin Forster & Paolo Pertile, 2013. "Optimal decision rules for HTA under uncertainty: a wider, dynamic perspective," Health Economics, John Wiley & Sons, Ltd., vol. 22(12), pages 1507-1514, December.
    7. Jörgen Hellström & Niklas Rudholm, 2010. "Uncertainty in the generic versus brand name prescription decision," Empirical Economics, Springer, vol. 38(3), pages 503-521, June.
    8. Patrick Leoni & St�phane Luchini, "undated". "Design the Financial Tool to Promote Universal Free Access to AIDS Care," IEW - Working Papers 214, Institute for Empirical Research in Economics - University of Zurich.
    9. Arthur E. Attema & Anna K. Lugnér & Talitha L. Feenstra, 2010. "Investment in antiviral drugs: a real options approach," Health Economics, John Wiley & Sons, Ltd., vol. 19(10), pages 1240-1254, October.
    10. Lasserre, Pierre & Moatti, Jean-Paul & Soubeyran, Antoine, 2006. "Early initiation of highly active antiretroviral therapies for AIDS: Dynamic choice with endogenous and exogenous learning," Journal of Health Economics, Elsevier, vol. 25(3), pages 579-598, May.
    11. Patrick Leoni & St�phane Luchini, "undated". "Designing the Financial Tools to Promote Universal Free-Access to AIDS Care," IEW - Working Papers 227, Institute for Empirical Research in Economics - University of Zurich.
    12. Rosella Levaggi & Michele Moretto & Vincenzo Rebba, 2009. "Investment decisions in hospital technology when physicians are devoted workers," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 18(5), pages 487-512.
    13. Oscar Gutiérrez & Francisco Ruiz-Aliseda, 2011. "Real options with unknown-date events," Annals of Finance, Springer, vol. 7(2), pages 171-198, May.
    14. Arve, Malin & Zwart, Gijsbert, 2023. "Optimal procurement and investment in new technologies under uncertainty," Journal of Economic Dynamics and Control, Elsevier, vol. 147(C).
    15. Marks, Phillipa & Marks, Brian, 2007. "Spectrum Allocation, Spectrum Commons and Public Goods: the Role of the Market," MPRA Paper 6785, University Library of Munich, Germany.
    16. David K. Evans & Arkadipta Ghosh, 2008. "Prioritizing Educational Investments in Children in the Developing World," Working Papers WR-587, RAND Corporation.
    17. Pierre‐Richard Agénor, 2004. "Macroeconomic Adjustment and the Poor: Analytical Issues and Cross‐Country Evidence," Journal of Economic Surveys, Wiley Blackwell, vol. 18(3), pages 351-408, July.
    18. Atal, Vidya & Bar, Talia & Gordon, Sidartha, 2016. "Project selection: Commitment and competition," Games and Economic Behavior, Elsevier, vol. 96(C), pages 30-48.
    19. Prelipcean, Gabriela & Boscoianu, Mircea, 2019. "Aspect Regarding the Design of Active Strategies for Venture Capital Financing – the Flexible Adjustment for Romania as a Frontier Capital Market," Proceedings of the ENTRENOVA - ENTerprise REsearch InNOVAtion Conference (2019), Rovinj, Croatia, in: Proceedings of the ENTRENOVA - ENTerprise REsearch InNOVAtion Conference, Rovinj, Croatia, 12-14 September 2019, pages 187-196, IRENET - Society for Advancing Innovation and Research in Economy, Zagreb.
    20. Waters, James, 2015. "Optimal design and consequences of financial disclosure regulation: a real options approach," MPRA Paper 63369, University Library of Munich, Germany.

    More about this item

    Keywords

    HIV/AIDS funding Security design Therapeutic innovation Health underinvestment HIV/AIDS vaccine;

    JEL classification:

    • I1 - Health, Education, and Welfare - - Health
    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jhecon:v:30:y:2011:i:1:p:181-188. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/505560 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.