Replication data for: Do Firms Underinvest in Long-Term Research? Evidence from Cancer Clinical Trials

Principal Investigator(s):  View help for Principal Investigator(s) Eric Budish; Benjamin N. Roin; Heidi Williams

Version:  View help for Version V1

Name File Type Size Last Modified
final_research_analysis.do text/plain 29.1 KB 12/06/2019 12:00:PM
final_survival_analysis.do text/plain 8.4 KB 12/06/2019 12:00:PM

Project Description

Summary:  View help for Summary We investigate whether private research investments are distorted away from long-term projects. Our theoretical model highlights two potential sources of this distortion: short-termism and the fixed patent term. Our empirical context is cancer research, where clinical trials -- and hence, project durations -- are shorter for late-stage cancer treatments relative to early-stage treatments or cancer prevention. Using newly constructed data, we document several sources of evidence that together show private research investments are distorted away from long-term projects. The value of life-years at stake appears large. We analyze three potential policy responses: surrogate (non-mortality) clinical-trial endpoints, targeted R&D subsidies, and patent design. (JEL D92, G31, I11, L65, O31, O34)

Scope of Project

JEL Classification:  View help for JEL Classification
      D25 Intertemporal Firm Choice: Investment, Capacity, and Financing
      G31 Capital Budgeting; Fixed Investment and Inventory Studies; Capacity
      I11 Analysis of Health Care Markets
      L65 Chemicals; Rubber; Drugs; Biotechnology; Plastics
      O31 Innovation and Invention: Processes and Incentives
      O34 Intellectual Property and Intellectual Capital


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V1 [2019-12-06]

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