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Research Interests: Industrial organization, microeconomic theory, law and economics
Courses Taught: Microeconomics (Economics 21), Competition and Strategy (Economics 25), Advanced Topics in Microeconomics (Economics 81)
Office: 312A Silsby Hall
“Economics Perspectives on the Advance Market Commitment for Pneumococcal Vaccines” (with Wills Begor and Ernst Berndt) Health Affairs, Aug. 2011, vol. 30 no. 8, pp.1508-1517
Background: Pneumococcal disease is the most common vaccine-preventable cause of death for young children worldwide. In order to reduce mortality from this disease, it is important to figure out how to rapidly increase the availability of these vaccines in poor countries. In this paper, the authors consider the economics of a new financing programming known as the “advance market commitment,” which substantially increased the speed of the rollout of second-generation pneumococcal vaccines.
Summary: Given the difficulties that pharmaceutical companies face in earning a high return when selling vaccines in poor countries, they have often been reluctant to invest in producing vaccines for these countries. The advance market commitment is a program financed by international donors that aims to increase this investment. The donors pay pharmaceutical companies a premium for initial doses, and the companies supply vaccines over the longer term at lower prices. In the authors’ benchmark calculation, this program provided a net social benefit of $9.1 billion. The authors also found that the program’s subsidy cap increased its effectiveness. As a result of the advance market commitment, the rollout of second-generation pneumococcal vaccine in poor countries was substantially quicker than the rollout of the first-generation vaccine.
Fun Fact: Wills Begor ’12 was a valedictorian and worked on this paper as a Freedman Presidential Scholar.