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R&D for Neglected Diseases

Author

Listed:
  • Nicola Dimitri

    (Department of Economics and Statistics, University of Sienna, and Research Fellow, Maastricht School of Management)

Abstract

In 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.

Suggested Citation

  • Nicola Dimitri, 2012. "R&D for Neglected Diseases," Working Papers 2012/07, Maastricht School of Management.
  • Handle: RePEc:msm:wpaper:2012/07
    as

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    File URL: http://web2.msm.nl/RePEc/msm/wpaper/MSM-WP2012-07.pdf
    File Function: First version, 2012
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    References listed on IDEAS

    as
    1. Konrad, Kai A., 2009. "Strategy and Dynamics in Contests," OUP Catalogue, Oxford University Press, number 9780199549603.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    neglected disease;

    JEL classification:

    • D86 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Economics of Contract Law
    • L65 - Industrial Organization - - Industry Studies: Manufacturing - - - Chemicals; Rubber; Drugs; Biotechnology; Plastics
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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