Self-interested international income redistribution and access to health care innovation

Acharyya, Rajat; Garcia-Alonso, Maria

doi:10.1016/j.ejpoleco.2005.08.002

Cited by 7 publications

(5 citation statements)

References 14 publications

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“…3 (AGAIN, I WOULD FOOTNOTE OR TAKE OUT, IT DOESN'T RELATE TO OUR MODEL) Whereas product patent under a strict IPR(WE HAVE NOT DEFINED WHAT THIS IS YET, I WOULD TAKE OUT) regime may deny market access for the poor in the developing countries, the situation is apprehended to be worsened further by parallel imports allowed by the rich countries to ensure market access for the poor in their own countries. The reason is simple.…”

Section: Whereas Japan Allows International Exhaustion and The Eu Allmentioning

confidence: 99%

“…For y H ∈ [2y L , 3y L ], note the following: which is strictly positive for all relevant cross-country income differences as evident from the following diagram (which is drawn letting y H = ty L and then normalizing y L to unity; the relevant range of cross-country difference is thus given by the interval [1,3] A.9. Proof of Proposition 10: welfare properties of SPNE policy choices A.9.1 T h eh i g hi n c o m ec o u n t r yp r e f e r s( w e a kI P R ,M B D )t o( s t r i c t IPR,PI) By plotting all the above expressions, we can conclude that the most likely higher price increases arise when going (Weak IPR, MBD) to (Strict IPR, PI) (represented as the thicker line).…”

Section: A4 Proofoflemma7: Welfareundermbd:w Eakvsstrongiprmentioning

confidence: 99%

“…3 International exhaustion of patent rights has been applied in a wide range of products apart from the pharmaceutical products. 4 The general theoretical consensus is that price convergence makes the richer countries unambiguously better off but the poorer countries unambiguously worse-off (Danzon (1998), Maskus (2001), Richardson (2002) (I WOULD TAKE OUT, WE MENTION VALETTI LATER AND THE IMPLICATION ON INNOVATION HAS ALREADY BEEN MENTIONED).…”

Section: Of Late There Has Been An Equally Interesting Conßict Betwementioning

confidence: 99%

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Income based price subsidies and parallel imports

Acharyya

Garcia-Alonso

2012

International Review of Economics & Finance

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We consider a policy game between a high-income country hosting a drug innovator and a low-income country hosting a drug imitator. The low-income country chooses whether to enforce an International Patent Regime (strict IPR) or not (weak IPR) and the high-income country chooses whether to allow parallel imports (PI) of on-patent drugs or market based discrimination (MBD). We show that, for a moderately high imitation cost, both (Strict IPR,P a r a l l e lI m p o r t s )a n d( W e a kI P R , MBD) emerge as the Subgame Perfect Nash Equilibrium (SPNE) policy choices. For relatively smaller imitation costs, (Weak IPR, MBD) is the unique SPNE policy choice. The welfare properties reveal that although innovation may be higher at the (Strict IPR, PI), the market coverage and national welfare of the low-income country, and the total welfare are all lower. This opens up the efficiency issue of implementing TRIPS and at the same time allowing international exhaustion of patent rights. JEL ClassiÞcation: D4, L1, I1.

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Section: Whereas Japan Allows International Exhaustion and The Eu Allmentioning

confidence: 99%

Section: A4 Proofoflemma7: Welfareundermbd:w Eakvsstrongiprmentioning

confidence: 99%

Section: Of Late There Has Been An Equally Interesting Conßict Betwementioning

confidence: 99%

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Income based price subsidies and parallel imports

Acharyya

Garcia-Alonso

2012

International Review of Economics & Finance

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“…In a previous paper related to improvements in medical innovation,Acharyya and Garcia-Alonso (2006) examine how income redistribution may help poor people gain access to health care and increase the utility of consumers who suffer from reductions in income. In a more complex approach to applying game theory, Acharyya and Garcia-Alonso (2012) explore other issues, such as market coverage and welfare.…”

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confidence: 99%

Pareto-improving income redistribution: expanding consumer access to the vaccines market

García-del-Barrio

2017

Econ Gov

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Economic theory has proved that income redistribution in imperfectly competitive markets can increase social welfare and lead to Pareto-improving situations. This paper shows that, under certain assumptions, self-financing tax subsidy schemes can have Pareto-improving effects also in a competitive framework. This result is achieved by exploiting external economies of scale, resulting in a decrease in price along with an increase in output. The case of the vaccines industry and World Health Organization initiatives are examined to illustrate the theoretical analysis. KeywordsExternal economies of scale • Income transfer redistribution • Pareto-improving tax-subsidies • Vaccines industry JEL Classification D31 • D64 • H2 • L13

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“…See Gabszweicz and Thisse (1979) and Shaked and Sutton () for differences in marginal willingness‐to‐pay for quality being related to differences in income levels. A similar specification has been used in health markets elsewhere (Acharyya and García‐Alonso, , ).…”

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confidence: 99%

Universal Access, Parallel Trade and Incentives to Innovate

Acharyya

Garcia-Alonso

2013

Bulletin of Econ Res

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Governments often subsidize poorer groups in society to ensure their access to new drugs. We analyse the optimal income‐based price subsidies in a strategic environment. We show that universal access is less likely to arise when price arbitrage prevents international price discrimination. When this is not the case, under some income ranges, bilateral universal coverage can be supported by equilibrium subsidies together with bilateral partial provision. In such a case, international health policy coordination becomes relevant. We also show that asymmetric universal access to medicines across countries can arise, even when countries are ex ante symmetric, when international price discrimination is possible and governments cannot design subsidies proportional to either income or quality.

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Self-interested international income redistribution and access to health care innovation

Cited by 7 publications

References 14 publications

Income based price subsidies and parallel imports

Income based price subsidies and parallel imports

Pareto-improving income redistribution: expanding consumer access to the vaccines market

Universal Access, Parallel Trade and Incentives to Innovate

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