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Innovation and antibiotic use within antibiotic classes: Market incentives and economic instruments

Markus Herrmann (), Bruno Nkuiya () and Anne-Renée Dussault

Resource and Energy Economics, 2013, vol. 35, issue 4, 582-598

Abstract: We analyze a monopolist's incentive to innovate a new antibiotic which is connected to the same pool of antibiotic treatment efficacy as is another drug produced by a generic industry. We outline the differences of antibiotic use under market conditions and in the social optimum. A time- and state-dependent tax-subsidy mechanism is proposed to induce the monopolist and generic industry to exploit antibiotic efficacy optimally.

Keywords: Economics of antibiotic resistance; Antibiotic innovation; Monopoly; Generic industry; Social optimum; Economic instruments (search for similar items in EconPapers)
JEL-codes: D21 D42 I18 Q38 (search for similar items in EconPapers)
Date: 2013
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Related works:
Working Paper: Innovation and Antibiotic Use within Antibiotic Classes: Market Incentives and Economic Instruments (2013) Downloads
Working Paper: Innovation and Antibiotic Use within Antibiotic Classes: Market Incentives and Economic Instruments (2013) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:eee:resene:v:35:y:2013:i:4:p:582-598

DOI: 10.1016/j.reseneeco.2013.08.001

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