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Induced Innovation and Social Inequality: Evidence from Infant Medical Care

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  • David M. Cutler
  • Ellen Meara
  • Seth Richards-Shubik

Abstract

We develop a model of induced innovation that applies to medical research. Our model yields three empirical predictions. First, initial death rates and subsequent research effort should be positively correlated. Second, research effort should be associated with more rapid mortality declines. Third, as a byproduct of targeting the most common conditions in the population as a whole, induced innovation leads to growth in mortality disparities between minority and majority groups. Using information on infant deaths in the United States between 1983 and 1998, we find support for all three empirical predictions.

Suggested Citation

  • David M. Cutler & Ellen Meara & Seth Richards-Shubik, 2012. "Induced Innovation and Social Inequality: Evidence from Infant Medical Care," Journal of Human Resources, University of Wisconsin Press, vol. 47(2), pages 456-492.
  • Handle: RePEc:uwp:jhriss:v:46:y:2012:ii:1:p:456-492
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    Cited by:

    1. Lazuka, Volha, 2021. "Heterogeneous Returns to Medical Innovations," Lund Papers in Economic History 225, Lund University, Department of Economic History.
    2. Jostein Grytten & Lars Monkerud & Irene Skau & Anne Eskild & Rune J. Sørensen & Ola Didrik Saugstad, 2017. "Saving Newborn Babies – The Benefits of Interventions in Neonatal Care in Norway over More Than 40 Years," Health Economics, John Wiley & Sons, Ltd., vol. 26(3), pages 352-370, March.
    3. Raphaël Godefroy, 2010. "The birth of the congressional clinic," Working Papers halshs-00564921, HAL.
    4. Kevin A. Bryan & Heidi L. Williams, 2021. "Innovation: Market Failures and Public Policies," NBER Working Papers 29173, National Bureau of Economic Research, Inc.
    5. Lazuka, Volha, 2019. "It’s a long walk: Lasting effects of maternity ward openings on labour market performance," Lund Papers in Economic History 187, Lund University, Department of Economic History.
    6. Sampat, Bhaven N., 2012. "Mission-oriented biomedical research at the NIH," Research Policy, Elsevier, vol. 41(10), pages 1729-1741.
    7. Lazuka, Volha, 2017. "Infant health and later-life labour market outcomes : Evidence from the introduction of sulfa antibiotics in Sweden," Lund Papers in Economic History 154, Lund University, Department of Economic History.
    8. Elder Todd E & Goddeeris John H & Haider Steven J, 2011. "A Deadly Disparity: A Unified Assessment of the Black-White Infant Mortality Gap," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 11(1), pages 1-44, June.
    9. Volha Lazuka, 2022. "Household and individual economic responses to different health shocks: The role of medical innovations," Papers 2206.03306, arXiv.org, revised Nov 2022.
    10. Deepak Hegde & Bhaven Sampat, 2015. "Can Private Money Buy Public Science? Disease Group Lobbying and Federal Funding for Biomedical Research," Management Science, INFORMS, vol. 61(10), pages 2281-2298, October.

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    More about this item

    JEL classification:

    • I1 - Health, Education, and Welfare - - Health
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • J1 - Labor and Demographic Economics - - Demographic Economics
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination

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