Abstract

http://ssrn.com/abstract=933106
 
 

References (20)



 
 

Citations (8)



 


 



Parallel Imports and Price Controls


Gene M. Grossman


Princeton University - Woodrow Wilson School of Public and International Affairs; Princeton University - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute); Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Edwin L.-C. Lai


Hong Kong University of Science & Technology

August 2006

CEPR Discussion Paper No. 5779

Abstract:     
Price controls create opportunities for international arbitrage. Many have argued that such arbitrage, if tolerated, will undermine intellectual property rights and dull the incentives for investment in research-intensive industries such as pharmaceuticals. We challenge this orthodox view and show, to the contrary, that the pace of innovation often is faster in a world with international exhaustion of intellectual property rights than in one with national exhaustion. The key to our conclusion is to recognize that governments will make different choices of price controls when parallel imports are allowed by their trade partners than they will when they are not.

Number of Pages in PDF File: 31

Keywords: Pharmaceuticals, reimportation, intellectual property, TRIPs

JEL Classification: F13, O34

working papers series


Date posted: September 27, 2006  

Suggested Citation

Grossman, Gene M. and Lai, Edwin L.-C., Parallel Imports and Price Controls (August 2006). CEPR Discussion Paper No. 5779. Available at SSRN: http://ssrn.com/abstract=933106

Contact Information

Gene M. Grossman (Contact Author)
Princeton University - Woodrow Wilson School of Public and International Affairs ( email )
300 Fisher Hall
Prospect Avenue
Princeton, NJ 08544-1021
United States
609-258-4823 (Phone)
609-258-1374 (Fax)
Princeton University - Department of Economics ( email )
Princeton, NJ 08544-1021
United States

CESifo (Center for Economic Studies and Ifo Institute)
Poschinger Str. 5
Munich, DE-81679
Germany
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
National Bureau of Economic Research (NBER)
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Edwin L.-C. Lai
Hong Kong University of Science & Technology ( email )
Clearwater Bay
Kowloon
Hong Kong
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