Many countries with national health care providers and health insurances regulate the market for pharmaceuticals to steer drug demand and to control expenses. For example, they introduce reference pricing or tiered co-payments to enhance drug substitution and competition. Since 2006, Germany...

Economic theory does not provide sharp predictions on the welfare effects of banning wholesaleprice discrimination: if downstream cost differences exist, then discrimination shifts productioninefficiently, toward high-cost retailers, so a ban increases welfare; if differences in price...