Article: New drugs: health and economic impacts. (Research Summaries).

Many economists believe that new goods are at the heart of economic progress, and that innovative goods are better than older products because they provide more "product services" in relation to their cost of production. The pharmaceutical industry has among the highest propensities to generate new goods; it is one of the most R and D-intensive industries in the economy. Moreover, in part because of extensive FDA regulation, there is unusually good data about the launch and diffusion of new pharmaceutical goods. I have used these data to perform a number of econometric studies at the individual, disease, and country level, in order to assess the health and economic impacts ...

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