This paper provides empirical evidence on the impact of patents on drug prices across developing countries. It uses sales data on HIV/AIDS drugs in a sample of 34 low and middle-income countries between 1995 and mid-2000. The main findings are that patents do shift drug prices up, that drug prices are correlated to per capita income levels, and that drug firms follow a skimming strategy when pricing new HIV/AIDS drugs. That is, there is across country and intertemporal price discrimination in the global drug markets.
The authors' principal purpose is to study why the government in Spain has maintained price regulations on medicines during the last thirty-five years. The hypothesis is that price regulations were related to the regulatory style of the Spanish government in the 1960s and, since the last 1970s, have become a key instrument for preventing the pharmaceutical costs of the National Health System from rising. In order to test this hypothesis, two questions are considered. The first relates to how business interests and their main representative bodies have managed to influence the implementation of price regulations during the last thirty-five years. The second question concerns the extent to which changes in the prices of medicines have been effective in preventing increased costs of the Spanish National Health System drug bill between 1964 ad 1994. After analyzing the political economy of the price regulation of medicines and pharmaceutical cost-limiting policies during the last thirty-five years in Spain, and after estimating a function of the public demand for medicines between 1964 and 1994 in Spain, the authors extract the following two conclusions. First, price regulation has become a very useful instrument for preventing public pharmaceutical costs from rising since the late 1970s in Spain. Second, business interests have found it increasingly useful over the last thirty-five years to establish a stable framework in the market for medicines based on price regulation and the public provision of medicines.
AbstractThis paper estimates the impact of reforming competition authorities on perceived antitrust effectiveness using methods of causal inference. We study how 20 countries reformed their competition authorities in depth between 1995 and 2020, and what has been the outcome of such reforms in the perceived competition policy effectiveness by the business community compared with 18 control countries in a balanced panel. As the political economy literature warned, we find that reforms paradoxically have not always improved antitrust effectiveness. Some of the reforms approved stalled or backlashed as politicians opted for a Machiavelli option: undertaking "counter‐reforms" even in the name of an apparent but deceptive progressiveness and pro‐competition drive.
Competition policy is a dynamic process in which two questions arise: the configuration of the institutional framework and, on the other hand, the potential negative effects of the reforms processes. Based on surveys to employers (International Institute for Management Development, IMD), this paper evaluates the evolution of the effectiveness of competition policy at international level and how some countries' competition policy (or authority) reforms change this perceived effectiveness: United Kingdom, France, Netherlands, Finland and Spain. Results show that the last Spanish competition policy reform (creation of the CNMC), was non-positive, despite some improvements in recent years.
Las políticas e instituciones están sometidas a ciclos de reforma y contra-reforma. Éstas pueden impulsar periodos de auge o declive en la efectividad de las políticas públicas. Estos ciclos son especialmente volátiles y amplios en los países que tienen problemas de estabilidad institucional. En España, la política de competencia ilustra estos ciclos volátiles y amplios en la efectividad de las políticas públicas como pocas otras. En los últimos 20 años (1995-2014), España ha vivido dos ciclos completos de intensos auges y declives en la efectividad de la política de competencia, con una ganancia media de efectividad del 14 por 100. El último ciclo de diez años (2005-2014) ha recogido un aumento destacable y posterior caída en la efectividad de la política de competencia, saldándose sin ganancia significativa en la misma: un inane y desgastante ciclo completo de reforma y contra-reforma. La comparación de resultados con un conjunto de 54 países del mundo muestra que esta volatilidad cíclica en la efectividad de la política de competencia en España es una anormalidad estadística. Dada la relevancia del marco institucional y el enforcement, nuestros resultados apuntan a la necesidad de estabilizar la calidad institucional en materia de competencia como garante de una mayor efectividad de la misma.
AbstractOn the basis of information collected from all the published European Commission's decisions in cartel cases between 1962 and 2014, this paper identifies different stages in the supra‐nationalization of cartel policy at the European Union (EU) level. It analyzes major competition policy reforms, strategies and initiatives taken by the European Commission (EC), and its relationship and interaction with Member States' resistance and other policy players' positions, which offers a new in‐depth study on the history and political economy of a key pillar of EU integration. It also provides a forensic analysis of the sanctioned cartels at each stage. This study shows that the introduction of the leniency programme was a critical juncture that allowed cartel authorities to identify cartels more effectively and to provide evidence for sanctioning collusion much more easily than before. This success was a key determinant for deepening the EU integration in competition policy. The intended drivers and the paradoxically unexpected shifters of such growing integration in cartel policy enforcement at the EU are discussed.
On the basis of information collected from all the published European Commission's decisions in cartel cases between 1962 and 2014, this paper identifies different stages in the supra‐nationalization of cartel policy at the European Union (EU) level. It analyzes major competition policy reforms, strategies and initiatives taken by the European Commission (EC), and its relationship and interaction with Member States' resistance and other policy players' positions, which offers a new in‐depth study on the history and political economy of a key pillar of EU integration. It also provides a forensic analysis of the sanctioned cartels at each stage. This study shows that the introduction of the leniency programme was a critical juncture that allowed cartel authorities to identify cartels more effectively and to provide evidence for sanctioning collusion much more easily than before. This success was a key determinant for deepening the EU integration in competition policy. The intended drivers and the paradoxically unexpected shifters of such growing integration in cartel policy enforcement at the EU are discussed.
There is no honour among thieves. This aphorism concisely expresses why the leniency programmes in competition policy have become one of the most effective instruments in the fight against the cartels. In this work we describe the dissemination, evolution, and effects of the aforementioned programmes in the two decades since its implementation around the world, paying special attention to what is being done at the European Union level and in Spain. The empirical regularities obtained from the descriptive analysis of leniency decisions adopted by the European Commission and by the Spanish Competition Authority provide relevant information about the effectiveness of their corresponding programmes, as well as information about the underlying reasons why companies, in this context, submit applications for sanction exemption or reductions in the penalty amount. We conclude that still there is scope to increase substantially the dissemination and implementation of the leniency programme in Spain, and if the reforms are handled correctly, the programme is set to catch up and to be the main source of detecting and sanctioning of Spanish cartels in the next decade
AbstractCartel busting often results in the restructuring of boards of directors, presumably to remove individuals (both executive and non-executive members) who may have been involved in the cartel. This study employs 2 exogenous changes—cartel busting and binding board gender quotas policies—to examine their impact on board gender composition using DiD and Staggered DiD methods. In countries with binding quotas, boards are already undergoing restructuring to include more women, even without the shock of cartel busting. Furthermore, boards increase the percentage of women in non-cartelized firms only when countries introduce binding gender quotas. Binding board gender quota regulations are effective in improving gender balance on corporate boards. Additionally, in countries without binding board gender quotas, only firms sanctioned for cartel conduct show an increase in the percentage of women after cartel busting, compared to non-sanctioned firms. Thus, board gender quota regulations and anti-cartel policies interact to influence the gender composition of sanctioned firms: binding gender policies are effective in achieving more balanced board gender composition, and cartel busting drives more balanced boards in sanctioned firms regardless of whether their countries have binding board quota regulations or not.
