Structural Models of the Prescription Drug Market provides a
critical review of the structural econometric research focusing on
the richness and complexity of the prescription drug market and
discussing future research directions. Because a large number of
papers rely on a Bayesian learning framework, Section 2 sets the
stage by introducing the basic learning model that will be useful
in later sections. Section 3 discusses the literature that makes
use of individual level data. Section 4 discusses the literature
that studies the product lifecycle, which primarily uses product
level data. This is a broad set of articles, which includes studies
focusing on persuasive versus informative effects, clinical
outcomes, and publicity, as well as models related to pre-market
behavior (such as R&D decisions and clinical trial outcomes).
Section 5 addresses other related applications of structural models
in this area, and Section 6 summarizes the key takeaways and
discusses future research directions.
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