Author\/Editor: Ruchir Agarwal ; Patrick Gaule, Publication Date:February 19, 2021
\nSummary:To examine the drivers of innovation, this paper studies the global R&D effort to fight the deadliest diseases and presents four results. We find: (1) global pharmaceutical R&D activity\u2014measured by clinical trials\u2014typically follows the \u2018law of diminishing effort\u2019: i.e. the elasticity of R&D effort with respect to market size is about \u00bd in the cross-section of diseases; (2) the RD response to COVID-19 has been a major exception to this law, with the number of COVID-19 trials being 7 to 20 times greater than that implied by its market size; (3) the aggregate short-term elasticity of science and innovation can be very large, as demonstrated by aggregate flow of clinical trials increasing by 38% in 2020, with limited crowding out of trials for non-COVID diseases; and (4) public institutions and government-led incentives were a key driver of the COVID-19 R&D effort\u2014with public research institutions accounting for 70 percent of all COVID-19 clinical trials globally and being 10 percentage points more likely to conduct a COVID-19 trial relative to private firms. Overall, while economists are naturally in favor of market size as a driving force for innovation (i.e.\u201cif the market size is sufficiently large then innovation will happen\u201d), our work suggests that scaling up global innovation may require a broader perspective on the drivers of innovation\u2014including early-stage incentives, non-monetary incentives, and public institutions.
\nSeries:Working Paper No. 2021\/048
\nhttps:\/\/www.imf.org\/en\/Publications\/WP\/Issues\/2021\/02\/20\/What-Drives-Innovation-Lessons-from-COVID-19-R-D-50096<\/p>\n","protected":false},"excerpt":{"rendered":"
Author\/Editor: Ruchir Agarwal ; Patrick Gaule, Publication Date:February 19, 2021 Summary:To examine the drivers of innovation, this paper studies the global R&D effort to fight the deadliest diseases and presents four results. We find: (1) global pharmaceutical R&D activity\u2014measured by clinical trials\u2014typically follows the \u2018law of diminishing effort\u2019: i.e. the elasticity of R&D effort with […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-5564","post","type-post","status-publish","format-standard","hentry","category-international-economics"],"_links":{"self":[{"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=\/wp\/v2\/posts\/5564","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=5564"}],"version-history":[{"count":1,"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=\/wp\/v2\/posts\/5564\/revisions"}],"predecessor-version":[{"id":5565,"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=\/wp\/v2\/posts\/5564\/revisions\/5565"}],"wp:attachment":[{"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=5564"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=5564"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=5564"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}