|
on Marketing |
|
Issue of 2008‒06‒07
three papers chosen by Joao Carlos Correia Leitao University of the Beira Interior |
| By: | Patricia M. Danzon; Andrew J. Epstein |
| Abstract: | This study examines the effect of price regulation and competition on launch timing and pricing of new drugs. Our data cover launch experience in 15 countries for drugs in 12 therapeutic classes that experienced significant innovation over the decade 1992-2003. We use prices of established products as a measure of the direct effect of a country's own regulatory system, and find that launch timing and prices of innovative drugs are influenced by prices of established products. Thus, if price regulation reduces drug prices, it contributes to launch delay in the home country. New drug launch hazards and launch prices in low-price countries are also affected by referencing by other, high-price countries, especially within the EU, as expected if manufacturers delay launch in low-price markets to avoid undermining higher prices in other countries. Thus, referencing policies adopted in high-price countries can impose welfare loss on low-price countries. Prices of new drugs are influenced mainly by prices of other drugs within the same subclass; however, dynamic competition from new subclasses undermines new drug launch in older subclasses. Association with a local firm accelerates launch only in certain regulated markets. These findings have implications for US proposals to constrain pharmaceutical prices in the US through external referencing and drug importation. |
| JEL: | I11 I18 K2 L5 L65 |
| Date: | 2008–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14041&r=mkt |
| By: | Charles Sprenger; Joanna Stavins |
| Abstract: | Approximately half of credit card holders in the United States regularly carry unpaid credit card debt. These so-called "revolvers" exhibit payment behavior that differs from that of those who repay their entire credit card balance every month. Previous literature has focused on the adoption of debit cards by people who carry credit card balances, but so far there has been no empirical analysis exploring the relationship between revolving behavior and patterns of payment use, such as substitution away from credit cards to other payment methods. ; Using data collected in the 2005 Survey of Consumer Payment Preferences, we explore the relationship between revolving credit card balances and payment use. We find that credit card revolvers are significantly more likely to use debit and less likely to use credit than convenience users who repay their balances each month. There is no significant difference between these two types of credit card users in their use of check or cash. The two groups differ in their perceptions of payments as well as in their payment behavior: revolvers are significantly less likely to view debit as superior with respect to ease of use and acceptability, but more likely to see debit as superior with respect to control over money and budgeting. |
| Keywords: | Consumer credit ; Debit cards ; Credit cards ; Consumer behavior |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbwp:08-2&r=mkt |
| By: | Christina Matzke, Benedikt Wirth |
| Abstract: | In our model, individual consumers follow simple behavioral decision rules based on imitation and habit as suggested in consumer research, social learning, and related fields. Demand can be viewed as the outcome of a population game whose revision protocol is determined by the consumers' behavioral rules. The consumer dynamics are then analyzed in order to explore the demand side and first implications for a strategic supply side. |
| Keywords: | bounded rationality, social learning, population game, mean dynamic |
| JEL: | C61 C62 C79 |
| URL: | http://d.repec.org/n?u=RePEc:bon:bonedp:bgse10_2008&r=mkt |