Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/240468 
Year of Publication: 
2020
Series/Report no.: 
IFN Working Paper No. 1325
Publisher: 
Research Institute of Industrial Economics (IFN), Stockholm
Abstract: 
This paper investigates price patterns of off-patent pharmaceuticals in Sweden. I show that price dynamics are dependent on the number of competitors in the market. The price patterns follow predictions from a model of dynamic price competition in which the demand for pharmaceuticals incorporates the known biases of consumers: habit persistence and brand preferences. Using the regulated market of Swedish pharmaceuticals, I show that price may help in identifying possible tacit collusion by manufacturers in markets where consumers experience behavioral frictions.
Subjects: 
Pharmaceutical pricing
Dynamic oligopoly
State dependence
Price cycles
JEL: 
D43
I11
L13
L40
Document Type: 
Working Paper

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