Vaccine Supply: Effects of Regulation and Competition
AbstractIn US vaccine markets, competing producers with high fixed, sunk costs face relatively concentrated demand. The resulting price and quality competition leads to the exit of all but one or very few producers per vaccine. Our empirical analysis of exits from US vaccine markets supports the hypothesis that high fixed costs and both price and quality competition contribute to vaccine exits. We find no evidence that government purchasing has significant effects, possibly because government purchase tends to increase volume but lower price, with offsetting effects. Evidence from the flu vaccine market confirms that government purchasing is not a necessary condition for exits and the existence of few suppliers per vaccine in the US.
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Bibliographic InfoArticle provided by Taylor & Francis Journals in its journal International Journal of the Economics of Business.
Volume (Year): 18 (2011)
Issue (Month): 2 ()
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Web page: http://www.tandfonline.com/CIJB20
Other versions of this item:
- Patricia M. Danzon & Nuno S. Pereira, 2011. "Vaccine Supply: Effects Of Regulation And Competition," NBER Working Papers 17205, National Bureau of Economic Research, Inc.
- D4 - Microeconomics - - Market Structure and Pricing
- I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets
- I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
- L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
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