eprintid: 15833
rev_number: 29
eprint_status: archive
userid: 1482
importid: 105
dir: disk0/00/01/58/33
datestamp: 2014-07-09 17:42:08
lastmod: 2021-02-15 14:37:47
status_changed: 2021-02-15 14:37:47
type: monograph
metadata_visibility: show
creators_name: Dubois, Pierre
creators_name: Lasio, Laura
creators_idrefppn: 172637546
creators_idrefppn: 241586798
title: Identifying Industry Margins with Unobserved Price Constraints: Structural Estimation on Pharmaceuticals
ispublished: pub
subjects: subjects_ECO
abstract: We provide a method allowing identification of margins in an oligopoly price competition game when prices may not be freely chosen in some markets, for example due to regulation. We use our identification strategy to study the effects of regulatory constraints in the pharmaceutical industry. We provide the first structural estimation of price-cost margins on a regulated market with price constraints and show how to identify unknown possibly binding constraints thanks to three different markets (US, Germany and France) with varying regulatory constraints. We use the market for anti-ulcer drugs to identify whether regulation in France truly affects margins and prices and relate regulatory reforms to industry pricing equilibrium. Empirical results show that firms were especially constrained in price setting after the different reforms in 2004. Counterfactual simulations show that total spending significantly increased because of the new price regulation by displacing part of the demand from generics to branded drugs.
date: 2014-02
date_type: published
publisher: TSE Working Paper
official_url: http://tse-fr.eu/pub/27919
faculty: tse
divisions: tse
keywords: empirical IO
keywords: price constraints
keywords: Bertrand competition
keywords: regulation
keywords: pharmaceuticals
keywords: antiulcer drugs
language: en
has_fulltext: TRUE
subjectsJEL: JEL_I18
subjectsJEL: JEL_L10
view_date_year: 2014
full_text_status: public
monograph_type: working_paper
series: TSE Working Paper
volume: 14-471
place_of_pub: Toulouse
pages: 70
institution: Université Toulouse 1 Capitole
department: Toulouse School of Economics
book_title: TSE Working Paper
oai_identifier: oai:tse-fr.eu:27919
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oai_lastmod: 2021-01-27T11:36:05Z
oai_set: tse
oai_set: ut1c
site: ut1
citation:   Dubois, Pierre <https://www.idref.fr/172637546> and Lasio, Laura <https://www.idref.fr/241586798>  (2014) Identifying Industry Margins with Unobserved Price Constraints: Structural Estimation on Pharmaceuticals.  TSE Working Paper, n. 14-471, Toulouse     
document_url: https://publications.ut-capitole.fr/id/eprint/15833/1/wp_tse_471.pdf