Towards an Efficient Mechanism for Prescription Drug Procurement

Kyna Fong & Michael Schwarz
Working Paper 14718
DOI 10.3386/w14718
Issue Date

This paper applies ideas from mechanism design to model procurement of prescription drugs. We present a mechanism for government-funded market-driven drug procurement that achieves very close to full static efficiency -- all members have access to all but at most a single drug -- without distorting incentives for innovation.

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Topics

Microeconomics
Market Structure and Distribution
Health, Education, and Welfare
Health

Programs

Economics of Health

Working Groups

Market Design

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