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Income-Based Price Subsidies, Parallel Imports and Markets Access to New Drugs for the Poor

Author

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  • Rajat Acharyya
  • Maria D.C. Garcia-Alonso

Abstract

In health markets, government policies tend to subsidise poorer groups. The purpose of this paper is to analyse the implications of an income-based subsidy policy on the incentives of countries to implement price arbitrage and of firms to provide market access to poorer groups.

Suggested Citation

  • Rajat Acharyya & Maria D.C. Garcia-Alonso, 2008. "Income-Based Price Subsidies, Parallel Imports and Markets Access to New Drugs for the Poor," Studies in Economics 0820, School of Economics, University of Kent.
    • Handle: RePEc:ukc:ukcedp:0820
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    References listed on IDEAS

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    1. Stefan Felder, 2006. "Third-Degree Price Discrimination in the Presence of Subsidies," German Economic Review, Verein für Socialpolitik, vol. 7, pages 419-426, November.
    2. Martin Richardson, 2017. "An Elementary Proposition Concerning Parallel Imports," World Scientific Book Chapters, in: Dimensions of Trade Policy, chapter 14, pages 285-299, World Scientific Publishing Co. Pte. Ltd..
    3. Stefan Felder, 2004. "Drug price regulation under consumer moral hazard," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 5(4), pages 324-329, November.
    4. Gene M. Grossman & Edwin L.‐C. Lai, 2008. "Parallel imports and price controls," RAND Journal of Economics, RAND Corporation, vol. 39(2), pages 378-402, June.
    5. Garci­a-Alonso, Mari­a D.C. & Garci­a-Mariñoso, Begoña, 2008. "The strategic interaction between firms and formulary committees: Effects on the prices of new drugs," Journal of Health Economics, Elsevier, vol. 27(2), pages 377-404, March.
    6. Garber Alan M & Jones Charles I. & Romer Paul, 2006. "Insurance and Incentives for Medical Innovation," Forum for Health Economics & Policy, De Gruyter, vol. 9(2), pages 1-27, March.
    7. Izabela Jelovac & Catalina Bordoy, 2005. "Pricing and Welfare Implications of Parallel Imports in the Pharmaceutical Industry," International Journal of Health Economics and Management, Springer, vol. 5(1), pages 5-21, January.
    8. Acharyya, Rajat & Garcia-Alonso, Maria D.C., 2006. "Self-interested international income redistribution and access to health care innovation," European Journal of Political Economy, Elsevier, vol. 22(2), pages 322-336, June.
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    Cited by:

    1. Tonmoy Chatterjee & Kausik Gupta, 2015. "Health Care Quality and Finite Changes of Trade Policy," Foreign Trade Review, , vol. 50(1), pages 21-30, February.

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    More about this item

    Keywords

    Pharmaceuticals; Income Based Subsidies; Parallel Imports; Market Access;
    All these keywords.

    JEL classification:

    • D4 - Microeconomics - - Market Structure, Pricing, and Design
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • I1 - Health, Education, and Welfare - - Health

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