R&D for Neglected Diseases
AbstractIn recent years neglected diseases attracted much attention. In particular, a debate has developed on which incentive scheme could be more effective to stimulate R&D investments, by pharmaceutical companies, to treat such diseases. The debate took place in conferences, academic journals, reports and other arenas, and mostly focused on the merits and limitations of push, pulls and mixed push-pull, incentives. Taking this widely spread debate as a starting point, within a stylized economic model this work compares the strenght of alternative incentive schemes for inducing R&D investments. The model is a contribution to shed light on the key forces driving R&D decisions. Under the assumption of expected profit maximizing firms, the main message of the paper is that co-funding incentive schemes appear to be stronger incentives, than constant-sum schemes, in inducing firms R&D effort.
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Bibliographic InfoPaper provided by Maastricht School of Management in its series Working Papers with number 2012/07.
Length: 39 pages
Date of creation: Jun 2012
Date of revision:
Find related papers by JEL classification:
- D86 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Economics of Contract Law
- L65 - Industrial Organization - - Industry Studies: Manufacturing - - - Chemicals; Rubber; Drugs; Biotechnology
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
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- Konrad, Kai A., 2009. "Strategy and Dynamics in Contests," OUP Catalogue, Oxford University Press, number 9780199549603.
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