The negative effects of intellectual property protection (IPP) on trade volume have been found in the literature when market power effects dominate market expansion effects. Because both effects will increase profits, IPP will induce entry without ambiguity. However, using product-level entry data, negative effects on market supply are found after controlling for country-specific effects. An ex...

This paper studies how insurance coverage policies impact pharmaceutical innovation. In the United States, most patients obtain prescription drugs through plans administered by Pharmacy Benefit Managers (PBMs). Beginning in 2012, PBMs began refusing to provide for many newly approved when cheaper alternatives were available. We document a shift R&D strategies after this policy took effect: ...

We study the effect of privatizing Medicaid drug benefits on prices and utilization. Drug spending would decrease by 21.3 percent if private insurers administered all benefits. One-third is driven insurers’ ability to negotiate with pharmacies. The remaining two-thirds greater use lower cost drugs, such as generics, only realized in states that give flexibility design Privatization does not red...

When effort is multi-dimensional, firms will optimally “balance” the provision of incentives. Setting high-powered incentives along one dimension raises the returns to providing high-powered incentives along other dimensions which compete for the worker’s effort and/or attention (Holmstrom and Milgrom, 1991). We test for this effect in the context of for-profit pharmaceutical laboratories using...

This paper analyzes the impact of uncertainty concerning product quality of generic drugs on the substitution behavior of prescribing physicians. It is shown that uncertainty about the generic drug quality gives the physician a value of waiting for more information before switching to the generic version. In addition, it is shown that reducing the approval requirements for generic drugs, thereb...

XopN is a type III effector protein from Xanthomonas campestris pathovar vesicatoria that suppresses PAMP-triggered immunity (PTI) in tomato. Previous work reported that XopN interacts with the tomato 14-3-3 isoform TFT1; however, TFT1's role in PTI and/or XopN virulence was not determined. Here we show that TFT1 functions in PTI and is a XopN virulence target. Virus-induced gene silencing of T...

Liability laws designed to compensate for harms caused by defective products may also affect innovation. We examine this issue exploiting a major quasi-exogenous increase in liability risk faced US suppliers of polymers used manufacture medical implants. Difference-in-difference analyses show that surge suppliers’ had large and negative impact on downstream innovation implants, but it no signif...

This paper assesses the degree of financial and economic globalisation of British and German pharmaceutical companies during 1990 and 2001 and explores the changing balance between globalisation and national embeddedness. It tries to explain both the much lower degree of globalisation of German as compared to British companies in 1990, as well as their catching up at the beginning of the 21 cen...

We study the impact of regulation on competition between brand-names and generics and pharmaceutical expenditures using a unique policy experiment in Norway, where reference pricing (RP) replaced price cap regulation in 2003 for a sub-sample of off-patent products. First, we construct a vertical differentiation model to analyze the impact of regulation on prices and market shares of brand-names...

A policy debate continues about the relative merits and and negative consequences of federal policies that encourage patent protection to university research results. Given the importance of university research for innovation in many industries, the effects of such policies are of critical importance to firms. This paper examines the impact of the increase in university patenting on the effecti...