Monopoly and product quality

Mussa, Michael; Rosen, Sherwin

doi:10.1016/0022-0531(78)90085-6

Cited by 2,670 publications

(1,908 citation statements)

References 3 publications

Supporting

Mentioning

1,782

Contrasting

Unclassified

Order By: Relevance

“…In each country, there is a downward-sloping demand for a drug, generated by preferences à la Mussa and Rosen (1978). Speci…cally, consumers are heterogenous, and a consumer of type that buys a drug of product u at a price p i in country i enjoys a net utility given by: where measures the consumer's marginal valuation of quality.…”

Section: Model Assumptionsmentioning

confidence: 99%

Compulsory licensing and access to drugs

Stavropoulou

Valletti

2014

Eur J Health Econ

View full text Add to dashboard Cite

This is the accepted version of the paper.This version of the publication may differ from the final published version. Permanent repository link AbstractCompulsory licensing allows the use of a patented invention without the owner's consent, with the aim of improving access to essential drugs. The pharmaceutical sector argues that, if broadly used, it can be detrimental for innovation. We model the interaction between a company in the North, that holds the patent for a certain drug, and a government in the South that needs to purchase it. We show that both access to drugs as well as pharmaceutical innovation depend largely on the Southern country's ability to manufacture a generic version. If the manufacturing cost is too high, compulsory licensing is not exercised. As the cost decreases, it becomes a credible threat forcing prices down, but reducing both access and innovation. When the cost is low enough, the South produces its own generic version, and access reaches its highest value, despite a reduction in innovation. The global welfare analysis shows that the overall impact of compulsory licensing can be positive, even when accounting for its impact on innovation. We also consider the interaction between compulsory licensing and the strength of IPRs, which can have global repercussions in other markets beyond the South.

show abstract

Section: Model Assumptionsmentioning

confidence: 99%

Compulsory licensing and access to drugs

Stavropoulou

Valletti

2014

Eur J Health Econ

View full text Add to dashboard Cite

show abstract

“…9 A positive market expansion e¤ect of selling more than one quality is overcompensated by a negative cannibalization e¤ect. 10 Equilibrium strategy It remains now to set the equilibrium analysis, namely to see whether the incentive to acquisition dominates that to mixed bundling.…”

Section: The Basic Frameworkmentioning

confidence: 99%

“…9 In fact P Acq I and p Acq u are such that the demands for the base good alone and the low quality bundle are equal to zero 10 Since the pioneristic contribution of Mussa and Rosen (1978), a huge amount of literature has considered the pro…tability of quality discrimination by a monopolist in a vertically di¤erentiated market. See Acharyya (1998), Gabszewicz and Wauthy (2002), inter alia.…”

Section: The Basic Frameworkmentioning

confidence: 99%

A Note on Acquisition of Complements in a Vertically Differentiated Market

Tarola

Vergari

2012

SSRN Journal

View full text Add to dashboard Cite

This note is concerned with the e¤ects of joint ownership of complements when they are vertically di¤erentiated. We provide strong arguments for the positive nature of network integration among …rms, while showing at the same time that, in some circumstances, anti-competitive consequences can be observed under acquisition.JEL classi…cation: L1, L4. Keywords: Bundling, Acquisition, Vertical Di¤erentiationWe have bene…tted from useful comments from Jean J. Gabszewicz and Andrea Mantovani. Any remaining errors are ours.

show abstract

“…In the remainder of the paper we study the problem (17) - (19). In doing so we will refer to a price function as feasible if it satisfies (18) - (19).…”

Section: ψ)mentioning

confidence: 99%

“…This possibility corresponds to the cases of optimal bunching discussed in Goldman, Leland and Sibley [8] and is the only possibility in models in which the agent's utility is monotonic in type (cf. Baron and Myerson [1], Mussa and Rosen [19]). Second, the point-wise solution is discontinuous if the agent's participation constraint is binding at an interior type (as in the models of market making and countervailing incentives mentioned above).…”

Section: Introductionmentioning

confidence: 98%