There is considerable debate about the impact of health care reform on the growth in medical spending. Medical innovation is thought to be a central contributor to that growth. We argue that there is a unique linkage between reforms that affect output markets for medical care and medical R&D...

"The NBER Bulletin on Aging and Health provides summaries of publications like this. You can sign up to receive the NBER Bulletin on Aging and Health by email. Improvements in health have been a major contributor to gains in overall economic welfare. In this paper, we argue that previous...

Medical research and development (R&D) differs from other R&D because of a unique linkage between output and input markets for medical products: potential consumers of existing medical products are also potential subjects in clinical trials required to develop new products. Therefore, an...