Interdependent Pricing and Markup Behavior: An Empirical Analysis of GM, Ford and Chrysler

Our purpose in this paper is to develop and estimate a model of the US automobile industry that can be used to analyze the secular and cyclical strategic markup behavior and market structure of its three major domestic producers - - GM, Ford and Chrysler. The principal novelty in this paper is not such much in the underlying theory (we build on what Timothy Bresnahan has called the "new empirical industrial organization" literature), but rather in the actual empirical implementation of a multi-equation model sufficiently general to permit the testing of a variety of specific behavioral postulates associated with the interdependent strategic profit-maximizing behavior of GM, Ford and Chrysler. Using firm-specific annual data from 1959-83, we find that at usual levels of statistical significance, we cannot reject Cournot quantity-setting behavior, nor can we reject leader/follower quantity-setting behavior with GM as leader and Ford and Chrysler as followers; the parameter restrictions associated with leader/follower behavior are slightly more binding than those with Cournot, although the difference is not decisive. In terms of the cyclical analysis of market behavior, our most striking result is the great diversity of behavior we find among GM, Ford and Chrysler. Depending on which firm is being analyzed, there is support for the pro-cyclical "conventional wisdom" of markups (GM and Ford), as well as for the counter-cyclical "revisionist" literature (Chrysler). Diversity, rather than constancy and homogeneity, best characterizes firms in this industry.

Pathogen burden, inflammation, proliferation and apoptosis in human in-stent restenosis - Tissue characteristics compared to primary atherosclerosis

Pathogenic events leading to in-stent restenosis (ISR) are still incompletely understood. Among others, inflammation, immune reactions, deregulated cell death and growth have been suggested. Therefore, atherectomy probes from 21 patients with symptomatic ISR were analyzed by immunohistochemistry for pathogen burden and compared to primary target lesions from 20 stable angina patients. While cytomegalovirus, herpes simplex virus, Epstein-Barr virus and Helicobacter pylori were not found in ISR, acute and/or persistent chlamydial infection were present in 6/21 of these lesions (29%). Expression of human heat shock protein 60 was found in 8/21 of probes (38%). Indicated by distinct signals of CD68, CD40 and CRP, inflammation was present in 5/21 (24%), 3/21 (14%) and 2/21 (10%) of ISR cases. Cell density of ISR was significantly higher than that of primary lesions ( 977 +/- 315 vs. 431 +/- 148 cells/mm(2); p < 0.001). There was no replicating cell as shown by Ki67 or PCNA. TUNEL+ cells indicating apoptosis were seen in 6/21 of ISR specimens (29%). Quantitative analysis revealed lower expression levels for each intimal determinant in ISR compared to primary atheroma (all p < 0.05). In summary, human ISR at the time of clinical presentation is characterized by low frequency of pathogen burden and inflammation, but pronounced hypercellularity, low apoptosis and absence of proliferation. Copyright (C) 2004 S. Karger AG, Basel

Mergers, Deregulation and Cost Savings in the U.S. Rail Industry

The success of deregulation in creating a viable private rail freight system in the ?U.S. since 1979 is relatively undisputed. Deregulation has proceeded in three ways: (i) eased rate setting restrictions; (ii) simplified merger applications and approval procedures; and (iii) relaxed route abandonment policies. In this paper we attempt to disentangle the effects of deregulation on rail costs from those directly attributable to mergers and acquisitions. We employ a translog variable cost function, based on an unbalanced panel data set of annual observations for major U.S. Class I railroads from 1974 to 1986. We find that both deregulation and mergers contributed significantly to cost savings. However, of the accumulated cost savings achieved by the six major firms involved in mergers post-deregulation, we estimate that by 1986 about 91% of the reduction in accumulated costs is due to deregulation, and about 9% is directly due to mergers and acquisitions (which in turn were facilitated by regulatory reforms). In terms of factor biases, we find that both deregulation and mergers resulted in a substantial labor-saving bias; the point estimate of the deregulation labor-saving bias is larger than that for mergers, but we were not able to estimate this bias precisely. We conclude that mergers were not a prerequisite for railroads being able to achieve substantial cost and productivity improvements in our 1974-1986 sample period. Deregulation also had an enormous direct impact; indeed, its impact appears to have been much larger.

Rail Costs and Capital Adjustments in a Quasi-Regulated Environment

This paper reports on results obtained from the estimation of a rail cost function using a pooled-time series, cross section of Class I railroads for the period 1974-1986. An analysis is performed of short-run and long-run returns to scale, the extent of capital disequilibrium, and adjustments to way and structures capital in the heavily regulated and quasi-regulated environments before and after the passage of the Staggers Act in 1980. In general, it is found that there is considerable overcapitalization in the rail industry and that this has persisted in spite of the regulatory freedom provided by the Staggers Act.

Diffusion patterns of new anti-diabetic drugs into hospitals in Taiwan: the case of Thiazolidinediones for diabetes

<p>Abstract</p> <p>Background</p> <p>Diffusion of new drugs in the health care market affects patients' access to new treatment options and health care expenditures. We examined how a new drug class for diabetes mellitus, thiazolidinediones (TZDs), diffused in the health care market in Taiwan.</p> <p>Methods</p> <p>Assuming that monthly hospital prescriptions of TZDs could serve as a micro-market to perform drug penetration studies, we retrieved monthly TZD prescription data for 580 hospitals in Taiwan from Taiwan's National Health Insurance Research Database for the period between March 1, 2001 and December 31, 2005. Three diffusion parameters, time to adoption, speed of penetration (monthly growth on prescriptions), and peak penetration (maximum monthly prescription) were evaluated. Cox proportional hazards model and quantile regressions were estimated for analyses on the diffusion parameters.</p> <p>Results</p> <p>Prior hospital-level pharmaceutical prescription concentration significantly deterred the adoption of the new drug class (HR: 0.02, 95%CI = 0.01 to 0.04). Adoption of TZDs was slower in district hospitals (HR = 0.43, 95%CI = 0.24 to 0.75) than medical centers and faster in non-profit hospitals than public hospitals (HR = 1.79, 95%CI = 1.23 to 2.61). Quantile regression showed that penetration speed was associated with a hospital's prior anti-diabetic prescriptions (25%Q: 18.29; 50%Q: 25.57; 75%Q: 30.97). Higher peaks were found in hospitals that had adopted TZD early (25%Q: -40.33; 50%Q: -38.65; 75%Q: -32.29) and in hospitals in which the drugs penetrated more quickly (25%Q: 16.53; 50%Q: 24.91; 75%Q: 31.50).</p> <p>Conclusions</p> <p>Medical centers began to prescribe TZDs earlier, and they prescribed more TZDs at a faster pace. The TZD diffusion patterns varied among hospitals depending accreditation level, ownership type, and prescription volume of Anti-diabetic drugs.</p

Diffusion patterns of new anti-diabetic drugs into hospitals in Taiwan: the case of Thiazolidinediones for diabetes

<p>Abstract</p> <p>Background</p> <p>Diffusion of new drugs in the health care market affects patients' access to new treatment options and health care expenditures. We examined how a new drug class for diabetes mellitus, thiazolidinediones (TZDs), diffused in the health care market in Taiwan.</p> <p>Methods</p> <p>Assuming that monthly hospital prescriptions of TZDs could serve as a micro-market to perform drug penetration studies, we retrieved monthly TZD prescription data for 580 hospitals in Taiwan from Taiwan's National Health Insurance Research Database for the period between March 1, 2001 and December 31, 2005. Three diffusion parameters, time to adoption, speed of penetration (monthly growth on prescriptions), and peak penetration (maximum monthly prescription) were evaluated. Cox proportional hazards model and quantile regressions were estimated for analyses on the diffusion parameters.</p> <p>Results</p> <p>Prior hospital-level pharmaceutical prescription concentration significantly deterred the adoption of the new drug class (HR: 0.02, 95%CI = 0.01 to 0.04). Adoption of TZDs was slower in district hospitals (HR = 0.43, 95%CI = 0.24 to 0.75) than medical centers and faster in non-profit hospitals than public hospitals (HR = 1.79, 95%CI = 1.23 to 2.61). Quantile regression showed that penetration speed was associated with a hospital's prior anti-diabetic prescriptions (25%Q: 18.29; 50%Q: 25.57; 75%Q: 30.97). Higher peaks were found in hospitals that had adopted TZD early (25%Q: -40.33; 50%Q: -38.65; 75%Q: -32.29) and in hospitals in which the drugs penetrated more quickly (25%Q: 16.53; 50%Q: 24.91; 75%Q: 31.50).</p> <p>Conclusions</p> <p>Medical centers began to prescribe TZDs earlier, and they prescribed more TZDs at a faster pace. The TZD diffusion patterns varied among hospitals depending accreditation level, ownership type, and prescription volume of Anti-diabetic drugs.</p

Price regulation, new entry, and information shock on pharmaceutical market in Taiwan: a nationwide data-based study from 2001 to 2004

<p>Abstract</p> <p>Background</p> <p>Using non-steroidal anti-inflammatory drugs (NSAIDs) as a case, we used Taiwan's National Health Insurance (NHI) database, to empirically explore the association between policy interventions (price regulation, new drug entry, and an information shock) and drug expenditures, utilization, and market structure between 2001 and 2004.</p> <p>Methods</p> <p>All NSAIDs prescribed in ambulatory visits in the NHI system during our study period were included and aggregated quarterly. Segmented regression analysis for interrupted time series was used to examine the associations between two price regulations, two new drug entries (cyclooxygennase-2 inhibitors) and the rofecoxib safety signal and expenditures and utilization of all NSAIDs. Herfindahl index (HHI) was applied to further examine the association between these interventions and market structure of NSAIDs.</p> <p>Results</p> <p>New entry was the only variable that was significantly correlated with changes of expenditures (positive change, p = 0.02) and market structure of the NSAIDs market in the NHI system. The correlation between price regulation (first price regulation, p = 0.62; second price regulation, p = 0.26) and information shock (p = 0.31) and drug expenditure were not statistically significant. There was no significant change in the prescribing volume of NSAIDs per rheumatoid arthritis (RA) or osteoarthritis (OA) ambulatory visit during the observational period. The market share of NSAIDs had also been largely substituted by these new drugs up to 50%, in a three-year period and resulted in a more concentrated market structure (HHI 0.17).</p> <p>Conclusions</p> <p>Our empirical study found that new drug entry was the main driving force behind escalating drug spending, especially by altering the market share.</p

In Global Health Research, Is It Legitimate To Stop Clinical Trials Early on Account of Their Opportunity Costs?

This debate examines the ethics of reallocating resources invested in existing trials of older products into new trials of more scientifically advanced products

Cultural factors that affected the spatial and temporal epidemiology of kuru

Kuru is a prion disease which became epidemic among the Fore and surrounding linguistic groups in Papua New Guinea, peaking in the late 1950s. It was transmitted during the transumption (endocannibalism) of dead family members at mortuary feasts. In this study, we aimed to explain the historical spread and the changing epidemiological patterns of kuru by analysing factors that affected its transmission. We also examined what cultural group principally determined a family’s behaviour during mortuary rituals. Our investigations showed that differences in mortuary practices were responsible for the initial pattern of the spread of kuru and the ultimate shape of the epidemic, and for subsequent spatio-temporal differences in the epidemiology of kuru. Before transumption stopped altogether, the South Fore continued to eat the bodies of those who had died of kuru, whereas other linguistic groups, sooner or later, stopped doing so. The linguistic group was the primary cultural group that determined behaviour but at linguistic boundaries the neighbouring group’s cultural practices were often adopted. The epidemiological changes were not explained by genetic differences, but genetic studies led to an understanding of genetic susceptibility to kuru and the selection pressure imposed by kuru, and provided new insights into human history and evolution