Does generic entry always increase consumer welfare?

نویسندگان

  • Henry Grabowski
  • Tracy Lewis
  • Rahul Guha
  • Zoya Ivanova
  • Maria Salgado
  • Sally Woodhouse
چکیده

This article examines how the nature of competition between brands in a therapeutic category changes after generic entry and provide a framework for analyzing the effect of generic entry on consumer welfare that takes into account the generic free riding problem. It demonstrates that changes in competition along dimensions other than retail price--such as competition in research and development efforts and in promotional activities--may, in certain situations, result in generic entry having an overall negative impact on consumer welfare.

برای دانلود متن کامل این مقاله و بیش از 32 میلیون مقاله دیگر ابتدا ثبت نام کنید

ثبت نام

اگر عضو سایت هستید لطفا وارد حساب کاربری خود شوید

منابع مشابه

Regulation and welfare: evidence from paragraph IV generic entry in the pharmaceutical industry

This article estimates welfare effects of accelerated generic entry via Paragraph IV challenges. Using data from 2000–2008 for hypertension drugs in the United States, we estimate demand using a random-coefficients logit model. We find consumers gain $42 billion whereas producers lose $32.5 billion from entry. This modest $9.5 billion gain in social welfare is consistent with our observation th...

متن کامل

Vi. Conclusion v. Subsidizing Black Firm Entry Ii. the Model

8 structural entry barriers in particular markets may not encourage Black rm entry. 12 Finally , the model suggests a normative perspective on whether or not Black rm entry should be subsidized. Demsetz (1982) has argued that entry barriers may consitute an endogenous response to consumer preferences. If for example, the basis for consumers having a taste for discrimination is their inability t...

متن کامل

Why Online Retail Competition Does Not Always Benefit Consumers

Empirical studies to date have delivered mixed conclusions on the question of whether the widely acclaimed assertions of lower electronic retail (e-tail) prices are indeed true, and to what extent these benefits are able to transcend the virtual world by impacting retail prices. One explanation for the mixed conclusions is that they provide only a discrete snapshot of a limited segment of the m...

متن کامل

Economic Analysis of Pay-for-delay Settlements and Their Legal Ruling

In this paper, we ask whether courts should continue to rule settlements in the context of pharmaceutical claims per se legal, when these settlements comprise payments from originator to generic companies, potentially delaying generic entry compared to the underlying litigation. Within a theoretical framework we compare consumer welfare under the rule of per se legality with that under alternat...

متن کامل

Does entry improve welfare? A general equilibrium approach to competition policy

We consider a simple general equilibrium model with imperfect competition. Firms are price taker in the input market and compete à la Cournot in some or all of the product markets (their technology displays constant returns to scale). We show that an increase in the number of firms does not always improve welfare. We also provide a characterization in terms of mark-up rates of the sectors for w...

متن کامل

ذخیره در منابع من


  با ذخیره ی این منبع در منابع من، دسترسی به آن را برای استفاده های بعدی آسان تر کنید

برای دانلود متن کامل این مقاله و بیش از 32 میلیون مقاله دیگر ابتدا ثبت نام کنید

ثبت نام

اگر عضو سایت هستید لطفا وارد حساب کاربری خود شوید

عنوان ژورنال:
  • Food and drug law journal

دوره 67 3  شماره 

صفحات  -

تاریخ انتشار 2012