A DYNAMIC OLIGOPOLY STRUCTURAL MODEL FOR THE PRESCRIPTION DRUG MARKET AFTER PATENT EXPIRATION*
构建了一个包含消费者学习和异质性的动态寡头模型，研究缩短仿制药审批时间对市场进入和消费者福利的影响，发现可能减少仿制药进入者数量并降低福利。
This article incorporates consumer learning and heterogeneity into a dynamic oligopoly model for the prescription drug market. In the model, both firms and patients need to learn the generic qualities via patients' experiences, generic firms' entry decisions are endogenous, but their entry timings depend on a random approval process. I apply the model to examine the impact of shortening the expected generic approval time. Although this policy experiment brings generics to the market sooner, it increases a potential entrant's likelihood of entering a crowded market and hence could reduce the total number of generic entrants and consumer welfare.