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Designing the Financial Tools to Promote Universal Access to AIDS Care

Author

Listed:
  • Patarick Leoni

    () (Economics Department, National University of Ireland, Maynooth)

  • Stephane Luchini

Abstract

We argue that reluctance to invest in drug treatments to fight the AIDS epidemics in developing countries is largely motivated by severe losses occurring from the future albeit uncertain appearance of a curative vaccine. We design a set of securities generating full insurance coverage against such losses, while achieving full risk-sharing with vaccine development agencies. In a general equilibrium framework, we show that those securities are demanded to improve social welfare in developing countries, to increase current investment in treatments and the provision of public goods. Even though designed foi AIDS, those securities can also be applied to other epidemics such as Malaria and Tuberculosis.

Suggested Citation

  • Patarick Leoni & Stephane Luchini, 2006. "Designing the Financial Tools to Promote Universal Access to AIDS Care," Economics, Finance and Accounting Department Working Paper Series n1711106, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth.
  • Handle: RePEc:may:mayecw:n1711106
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    File URL: http://repec.maynoothuniversity.ie/mayecw-files/N1711106.pdf
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    References listed on IDEAS

    as
    1. Palmer, Stephen & Smith, Peter C., 2000. "Incorporating option values into the economic evaluation of health care technologies," Journal of Health Economics, Elsevier, vol. 19(5), pages 755-766, September.
    2. Michael Kremer & Edward Miguel & Rebecca Thornton, 2009. "Incentives to Learn," The Review of Economics and Statistics, MIT Press, vol. 91(3), pages 437-456, August.
    3. Lasserre, Pierre & Moatti, Jean-Paul & Soubeyran, Antoine, 2006. "Early initiation of highly active antiretroviral therapies for AIDS: Dynamic choice with endogenous and exogenous learning," Journal of Health Economics, Elsevier, vol. 25(3), pages 579-598, May.
    4. Avinash Dixit, 2003. "Some Lessons from Transaction-Cost Politics for Less-Developed Countries," Economics and Politics, Wiley Blackwell, vol. 15(2), pages 107-133, July.
    5. LeRoy,Stephen F. & Werner,Jan, 2014. "Principles of Financial Economics," Cambridge Books, Cambridge University Press, number 9781107024120, February.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Fehr, Ernst & Fischbacher, Urs & Kosfeld, Michael, 2005. "Neuroeconomic Foundations of Trust and Social Preferences," IZA Discussion Papers 1641, Institute for the Study of Labor (IZA).
    2. Tania Singer & Ernst Fehr, 2005. "The Neuroeconomics of Mind Reading and Empathy," American Economic Review, American Economic Association, vol. 95(2), pages 340-345, May.
    3. Armin Falk & Ernst Fehr & Christian Zehnder, "undated". "The Behavioral Effects of Minimum Wages," IEW - Working Papers 247, Institute for Empirical Research in Economics - University of Zurich.

    More about this item

    Keywords

    HIV/Aids funding; security design; therapeutic innovation; health underinvestment; HIV/Aids vaccine;

    JEL classification:

    • I1 - Health, Education, and Welfare - - Health
    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets

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