Identifying Industry Margins with Price Constraints: Structural Estimation on Pharmaceuticals

• 成果类型: Article
• 署名作者: Dubois, Pierre; Lasio, Laura
• 署名单位: Universite de Toulouse; Universite Toulouse 1 Capitole; Toulouse School of Economics; McGill University; Universite de Montreal; Universite de Montreal
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20140202
• 发表日期: 2018
• 页码: 3685-3724
• 关键词: LOGIT-MODELS; market power; demand; entry; INFORMATION; CHOICE; performance; incentives; decisions; oligopoly

摘要

We develop a structural model to investigate the effects of pharmaceutical price regulation on demand and on manufacturers' price-setting behavior in France. We estimate price-cost margins in a regulated market with price constraints and infer whether these constraints are binding, exploiting cost restrictions across drugs, which come from observing the same drugs in potentially price-constrained markets (France) and in markets where prices are unregulated (United States and Germany). Our counterfactual simulations suggest that price constraints generated modest savings for anti-ulcer drugs in 2003-2013 (2 percent of total expenses), relative to a free pricing scenario, and shifted consumption from generic to branded drugs.