Innovation and antibiotic use within antibiotic classes: Market incentives and economic instruments
AbstractWe analyze a monopolist's incentive to innovate a new antibiotic which is connected to the same pool of antibiotic treatment efficacy as is another drug produced by a generic industry. We outline the differences of antibiotic use under market conditions and in the social optimum. A time- and state-dependent tax-subsidy mechanism is proposed to induce the monopolist and generic industry to exploit antibiotic efficacy optimally.
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Bibliographic InfoArticle provided by Elsevier in its journal Resource and Energy Economics.
Volume (Year): 35 (2013)
Issue (Month): 4 ()
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Web page: http://www.elsevier.com/locate/inca/505569
Economics of antibiotic resistance; Antibiotic innovation; Monopoly; Generic industry; Social optimum; Economic instruments;
Find related papers by JEL classification:
- D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
- D42 - Microeconomics - - Market Structure and Pricing - - - Monopoly
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
- Q38 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Government Policy (includes OPEC Policy)
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