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Most economists would argue that we would not have nearly as much innovation in medicine without a profit motive. Do you think those economists are wrong?

DmenshunlAnlsis 8y ago
I think: Most economists? That feels like a claim in need of a citation, or revision. Most economists aren’t medical doctors or pharmaceutical researchers. How many of the most useful medical breakthroughs were government funded?
- michaelkeenan 8y ago
  >> we would not have nearly as much innovation in medicine without a profit motive > Most economists? That feels like a claim in need of a citation The usual best place for finding out what economists think is the IGM Economics Experts Panel[1]. I mention it because it's a great resource to be aware of, but they haven't addressed this question, though it's covered in textbooks. I checked the Mankiw textbook on Principles of Microeconomics[2], which if I'm not mistaken is the world's most popular one. In the introduction, it says that people tend to supply things when the returns are high: "Incentives are crucial to analyzing how markets work. For example, when the price of an apple rises, people decide to eat fewer apples. At the same time, apple orchards decide to hire more workers and harvest more apples. In other words, a higher price in a market provides an incentive for buyers to consume less and an incentive for sellers to produce more. As we will see, the influence of prices on the behavior of consumers and producers is crucial for how a market economy allocates scarce resources." That becomes a background assumption for discussion of incentives in the rest of the book. For example, when talking about externalities, it notes that the patent system increases the incentive to innovate: "Research into new technologies provides a positive externality because it creates knowledge that other people can use. Because inventors cannot capture the full benefits of their inventions, they tend to devote too few resources to research. The federal government addresses this problem partially through the patent system, which gives inventors exclusive use of their inventions for a limited time." [1] http://www.igmchicago.org/igm-economic-experts-panel http://www.igmchicago.org/igm-economic-experts-panel [2] https://en.wikipedia.org/wiki/Greg_Mankiw#Textbooks https://en.wikipedia.org/wiki/Greg_Mankiw#Textbooks
prolikewhoa 8y ago
http://www.who.int/mediacentre/news/releases/2015/mtct-hiv-cuba/en/ http://www.who.int/mediacentre/news/releases/2015/mtct-hiv-c... Works in other systems where there is no profit motive.
- darawk 8y ago
  The fact that Cuba managed to do a thing isn't the same thing as proving equivalence between for-profit and non-profit healthcare systems re: innovation.
  - prolikewhoa 8y ago
    It's exactly what was asked for. There's no profit margin, yet they were the first in the world to come up with a vaccine. Sounds like a good example of innovation to me?
    - michaelkeenan 8y ago
      I think you're mixing up different news reports. Cuba reduced their mother-child HIV transmission using five generic antiretrovirals that were invented in the USA and Canada: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2688320/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2688320/ I'm not sure what would be a perfectly comprehensive metric for health innovations by country. Drug patents might be sort of close[1], but maybe Cuba doesn't apply for patents on principled grounds. For Cuba, it would be helpful to know the ratio of the USA using drugs or other innovations developed in Cuba versus American ones used in Cuba. I hear that drug development can cost billions of dollars[2] so I'd be surprised if Cuba could afford it, but maybe they've done it. Anyone know of any new drugs invented in Cuba? [1] e.g. https://www.americanactionforum.org/weekly-checkup/new-drug-patents-country/ https://www.americanactionforum.org/weekly-checkup/new-drug-... [2] https://www.scientificamerican.com/article/cost-to-develop-new-pharmaceutical-drug-now-exceeds-2-5b/ https://www.scientificamerican.com/article/cost-to-develop-n...
- whitepoplar 8y ago
  Because they benefit from the massive amount spent on medical innovation in the U.S.
neffy 8y ago
Alexander Flemming.
- pg_bot 8y ago
  Dr. Howard Florey and Ernst Chain deserve most of the credit for the development of Penicillin. They received the Nobel with Flemming and did most of the work in getting Penicillin out of the lab. I don't think relying on wonderful accidents is a practical way to go about medical innovation.
Alex3917 8y ago
> Most economists would argue that we would not have nearly as much innovation in medicine without a profit motive. Do you think those economists are wrong? I mean it's not like it's some thought experiment, you can look at the number of NMEs that offer significant clinical benefits over existing treatments before and after Bayh Dole.

DmenshunlAnlsis 8y ago

I think: Most economists? That feels like a claim in need of a citation, or revision. Most economists aren’t medical doctors or pharmaceutical researchers. How many of the most useful medical breakthroughs were government funded?

michaelkeenan 8y ago
>> we would not have nearly as much innovation in medicine without a profit motive > Most economists? That feels like a claim in need of a citation The usual best place for finding out what economists think is the IGM Economics Experts Panel[1]. I mention it because it's a great resource to be aware of, but they haven't addressed this question, though it's covered in textbooks. I checked the Mankiw textbook on Principles of Microeconomics[2], which if I'm not mistaken is the world's most popular one. In the introduction, it says that people tend to supply things when the returns are high: "Incentives are crucial to analyzing how markets work. For example, when the price of an apple rises, people decide to eat fewer apples. At the same time, apple orchards decide to hire more workers and harvest more apples. In other words, a higher price in a market provides an incentive for buyers to consume less and an incentive for sellers to produce more. As we will see, the influence of prices on the behavior of consumers and producers is crucial for how a market economy allocates scarce resources." That becomes a background assumption for discussion of incentives in the rest of the book. For example, when talking about externalities, it notes that the patent system increases the incentive to innovate: "Research into new technologies provides a positive externality because it creates knowledge that other people can use. Because inventors cannot capture the full benefits of their inventions, they tend to devote too few resources to research. The federal government addresses this problem partially through the patent system, which gives inventors exclusive use of their inventions for a limited time." [1] http://www.igmchicago.org/igm-economic-experts-panel http://www.igmchicago.org/igm-economic-experts-panel [2] https://en.wikipedia.org/wiki/Greg_Mankiw#Textbooks https://en.wikipedia.org/wiki/Greg_Mankiw#Textbooks

prolikewhoa 8y ago

http://www.who.int/mediacentre/news/releases/2015/mtct-hiv-cuba/en/ http://www.who.int/mediacentre/news/releases/2015/mtct-hiv-c... Works in other systems where there is no profit motive.

darawk 8y ago
The fact that Cuba managed to do a thing isn't the same thing as proving equivalence between for-profit and non-profit healthcare systems re: innovation.
- prolikewhoa 8y ago
  It's exactly what was asked for. There's no profit margin, yet they were the first in the world to come up with a vaccine. Sounds like a good example of innovation to me?
  - michaelkeenan 8y ago
    I think you're mixing up different news reports. Cuba reduced their mother-child HIV transmission using five generic antiretrovirals that were invented in the USA and Canada: https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2688320/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2688320/ I'm not sure what would be a perfectly comprehensive metric for health innovations by country. Drug patents might be sort of close[1], but maybe Cuba doesn't apply for patents on principled grounds. For Cuba, it would be helpful to know the ratio of the USA using drugs or other innovations developed in Cuba versus American ones used in Cuba. I hear that drug development can cost billions of dollars[2] so I'd be surprised if Cuba could afford it, but maybe they've done it. Anyone know of any new drugs invented in Cuba? [1] e.g. https://www.americanactionforum.org/weekly-checkup/new-drug-patents-country/ https://www.americanactionforum.org/weekly-checkup/new-drug-... [2] https://www.scientificamerican.com/article/cost-to-develop-new-pharmaceutical-drug-now-exceeds-2-5b/ https://www.scientificamerican.com/article/cost-to-develop-n...
whitepoplar 8y ago
Because they benefit from the massive amount spent on medical innovation in the U.S.

neffy 8y ago

Alexander Flemming.

pg_bot 8y ago
Dr. Howard Florey and Ernst Chain deserve most of the credit for the development of Penicillin. They received the Nobel with Flemming and did most of the work in getting Penicillin out of the lab. I don't think relying on wonderful accidents is a practical way to go about medical innovation.

Alex3917 8y ago

> Most economists would argue that we would not have nearly as much innovation in medicine without a profit motive. Do you think those economists are wrong? I mean it's not like it's some thought experiment, you can look at the number of NMEs that offer significant clinical benefits over existing treatments before and after Bayh Dole.