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External economies of scale, government purchasing commitment and welfare improvements in the vaccines industry

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  • Pedro Garcia-del-Barrio

    (Universitat Internacional de Catalunya)

Abstract

Some industries exhibit external economies of scale. In these cases,the introduction of self-financing tax subsidy programmes canimprove social welfare. This paper advocates intervention incompetitive markets if economies of scale existand implementing the policy is inexpensive.

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Bibliographic Info

Article provided by Europa Grande in its journal European Journal of Government and Economics.

Volume (Year): 1 (2012)
Issue (Month): 2 (December)
Pages: 163-179

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Handle: RePEc:egr:ejge00:v:1:i:2:p:163-179

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Keywords: external economies of scale; social welfare; tax-subsidy; income transfer; government intervention;

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  1. Chipman, John S, 1970. "External Economies of Scale and Competitive Equilibrium," The Quarterly Journal of Economics, MIT Press, vol. 84(3), pages 347-85, August.
  2. Panagariya, Arvind, 1981. "Variable Returns to Scale in Production and Patterns of Specialization," American Economic Review, American Economic Association, vol. 71(1), pages 221-30, March.
  3. Aoki, Masahiko, 1971. "Marshallian External Economies and Optimal Tax-Subsidy Structure," Econometrica, Econometric Society, vol. 39(1), pages 35-53, January.
  4. Chandra, Vandana & Franck, David & Naqvi, Nadeem, 2002. "World Increasing Returns and Production Subsidies," Economica, London School of Economics and Political Science, vol. 69(274), pages 223-27, May.
  5. Ethier, Wilfred J, 1982. "Decreasing Costs in International Trade and Frank Graham's Argument for Protection," Econometrica, Econometric Society, vol. 50(5), pages 1243-68, September.
  6. Jacques Th├ępot, 2003. "Pareto-Improving Redistribution in a Monopoly," The Japanese Economic Review, Japanese Economic Association, vol. 54(2), pages 165-178.
  7. Osana, Hiroaki, 1977. "Optimal Tax-Subsidy System for an Economy with Marshallian Externalities," Econometrica, Econometric Society, vol. 45(2), pages 329-40, March.
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