Spillovers Across Product Categories in the Medical Device Industry

49 Pages Posted: 7 Nov 2018 Last revised: 6 Aug 2020

See all articles by Matthew Grennan

Matthew Grennan

University of Pennsylvania - The Wharton School; National Bureau of Economic Research (NBER)

Charu Gupta

University of Pennsylvania - The Wharton School

Mara Lederman

University of Toronto - Rotman School of Management

Multiple version iconThere are 2 versions of this paper

Date Written: May 5, 2020

Abstract

We use detailed panel data at the buyer level to understand the size and nature of spillovers across product categories in medical devices. Difference-in-differences regressions identify spillovers in usage (accounting for 21 percent of market share) across categories that share physical features. All categories exhibit spillovers in contracting (accounting for 7 to 18 percent of the probability of contracting). These buyer-level spillovers represent up to half of all potential demand spillovers and one-third of the overall correlation in shares across categories, suggesting meaningful implications for firm strategy and antitrust policy for firms selling in multiple product categories.

Keywords: Innovation, Economies of Scope, Spillovers

Suggested Citation

Grennan, Matthew and Gupta, Charu and Lederman, Mara, Spillovers Across Product Categories in the Medical Device Industry (May 5, 2020). Available at SSRN: https://ssrn.com/abstract=3266574 or http://dx.doi.org/10.2139/ssrn.3266574

Matthew Grennan (Contact Author)

University of Pennsylvania - The Wharton School ( email )

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HOME PAGE: http://www.wharton.upenn.edu/faculty/grennan.cfm

National Bureau of Economic Research (NBER) ( email )

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Charu Gupta

University of Pennsylvania - The Wharton School ( email )

3641 Locust Walk
Philadelphia, PA 19104-6365
United States

Mara Lederman

University of Toronto - Rotman School of Management ( email )

105 St. George Street
Toronto, Ontario M5S 3E6 M5S1S4
Canada

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