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Heinrich-Heine-Universität Düsseldorf >
Düsseldorf Institute for Competition Economics (DICE), University of Düsseldorf >
DICE Discussion Paper, Düsseldorf Institute for Competition Economics (DICE) >
Please use this identifier to cite or link to this item:
http://hdl.handle.net/10419/56037
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| Title: | | The effects of rebate contracts on the health care system  |
| Authors: | | Graf, Julia |
| Issue Date: | | 2012 |
| Series/Report no.: | | DICE discussion paper 45 |
| Abstract: | | Group Purchasing Organizations (GPOs) increasingly gain in importance with respect to the supply of pharmaceutical products and frequently use multiple or exclusive rebate contracts to exercise market power. Based on a Hotelling model of horizontal and vertical product differentiation, we examine the controversy whether there exists a superior rebate scheme as far as consumer surplus, firms profits and total welfare are concerned. Accounting for horizontal and vertical differentiation, we find that firms clearly prefer multiple over exclusive rebate contracts. Contrary, there exists no rebate form that per se lowers total costs for the members of the GPOs or maximizes total welfare. |
| Subjects: | | GPOs Rebate Contracts Vertical Differentiation |
| JEL: | | I11 L13 L42 |
| ISBN: | | 978-3-86304-044-4 |
| Document Type: | | Working Paper |
| Appears in Collections: | | DICE Discussion Paper, Düsseldorf Institute for Competition Economics (DICE)
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