IDEAS home Printed from https://ideas.repec.org/a/wly/hlthec/v12y2003i2p125-138.html
   My bibliography  Save this article

Deadweight loss of bacterial resistance due to overtreatment

Author

Listed:
  • Elamin H. Elbasha

Abstract

Widespread use of antibiotics is considered the major driving force behind the development of antibiotic resistance. The benefits of exceeding the welfare‐maximizing level of antibiotic use are below the costs of resistance created by this excess quantity of antibiotics used, thereby resulting in a welfare deadweight loss. This paper uses a simple economic model to examine the theoretical and empirical aspects of the welfare loss generated by resistance and analyzes its policy implications. The annual deadweight loss associated with outpatient prescriptions for amoxicillin in the United States is estimated at $225 million. Published in 2002 by John Wiley & Sons, Ltd.

Suggested Citation

  • Elamin H. Elbasha, 2003. "Deadweight loss of bacterial resistance due to overtreatment," Health Economics, John Wiley & Sons, Ltd., vol. 12(2), pages 125-138, February.
    • Handle: RePEc:wly:hlthec:v:12:y:2003:i:2:p:125-138
    DOI: 10.1002/hec.702
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/hec.702
    Download Restriction: no
    File URL: https://libkey.io/10.1002/hec.702?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. James R. Hines, 1999. "Three Sides of Harberger Triangles," Journal of Economic Perspectives, American Economic Association, vol. 13(2), pages 167-188, Spring.
    2. Scherer, F.M., 2000. "The pharmaceutical industry," Handbook of Health Economics, in: A. J. Culyer & J. P. Newhouse (ed.), Handbook of Health Economics, edition 1, volume 1, chapter 25, pages 1297-1336, Elsevier.
    3. Coast, J. & Smith, R. D. & Millar, M. R., 1998. "An economic perspective on policy to reduce antimicrobial resistance," Social Science & Medicine, Elsevier, vol. 46(1), pages 29-38, January.
    4. Michael Baye & Robert Maness & Steven Wiggins, 1997. "Demand systems and the true subindex of the cost of living for pharmaceuticals," Applied Economics, Taylor & Francis Journals, vol. 29(9), pages 1179-1190.
    5. Mark Johnston & Richard Zeckhauser, 1991. "The Australian Pharmaceutical Subsidy Gambit: Transmuting Deadweight Loss and Oligopoly Rents to Consumer Surplus," NBER Working Papers 3783, National Bureau of Economic Research, Inc.
    6. Kenneth Elzinga & David Mills, 1997. "The Distribution and Pricing of Prescription Drugs," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 4(3), pages 287-300.
    7. Sara Ellison Fisher & Iain Cockburn & Zvi Griliches & Jerry Hausman, 1997. "Characteristics of Demand for Pharmaceutical Products: An Examination of Four Cephalosporins," RAND Journal of Economics, The RAND Corporation, vol. 28(3), pages 426-446, Autumn.
    8. Richard G. Frank & David S. Salkever, 1991. "Pricing, Patent Loss and the Market For Pharmaceuticals," NBER Working Papers 3803, National Bureau of Economic Research, Inc.
    9. Laxminarayan, Ramanan & Brown, Gardner M., 2001. "Economics of Antibiotic Resistance: A Theory of Optimal Use," Journal of Environmental Economics and Management, Elsevier, vol. 42(2), pages 183-206, September.
    10. Joanna Coast & Richard D. Smith & Michael R. Millar, 1996. "Superbugs: Should antimicrobial resistance be included as a cost in economic evaluation?," Health Economics, John Wiley & Sons, Ltd., vol. 5(3), pages 217-226, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Klaus Kaier & S. Moog, 2012. "Economic Consequences of the Demography of MRSA Patients and the Impact of Broad-Spectrum Antimicrobials," Applied Health Economics and Health Policy, Springer, vol. 10(4), pages 227-234, July.
    2. Lina Maria Ellegård & Jens Dietrichson & Anders Anell, 2018. "Can pay‐for‐performance to primary care providers stimulate appropriate use of antibiotics?," Health Economics, John Wiley & Sons, Ltd., vol. 27(1), pages 39-54, January.
    3. Thomas Heister & Christian Hagist & Klaus Kaier, 2015. "Resistance Elasticity of Antibiotic Demand in Intensive Care," WHU Working Paper Series - Economics Group 15-01, WHU - Otto Beisheim School of Management.
    4. Amitrajeet Batabyal & Peter Nijkamp, 2005. "Alternate strategies for managing resistance to antibiotics and pesticides," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 7(1), pages 39-51, March.
    5. M. Filippini & G. Masiero, 2012. "An empirical analysis of habit and addiction to antibiotics," Empirical Economics, Springer, vol. 42(2), pages 471-486, April.
    6. Batabyal, Sanjana S. & Batabyal, Amitrajeet A., 2018. "Medical decision-making by patients and providers under uncertainty and in the presence of antibiotic resistance," International Review of Economics & Finance, Elsevier, vol. 58(C), pages 604-613.
    7. Frank, Uwe & Kaier, Klaus, 2009. "Dynamics between antibiotic drug use and resistance: An economic approach," FZG Discussion Papers 36, University of Freiburg, Research Center for Generational Contracts (FZG).
    8. Herrmann, Markus & Gaudet, Gérard, 2009. "The economic dynamics of antibiotic efficacy under open access," Journal of Environmental Economics and Management, Elsevier, vol. 57(3), pages 334-350, May.
    9. David H. Howard, 2004. "Resistance‐induced antibiotic substitution," Health Economics, John Wiley & Sons, Ltd., vol. 13(6), pages 585-595, June.
    10. Markus Herrmann & Bruno Nkuiya, 2017. "Inducing optimal substitution between antibiotics under open access to the resource of antibiotic susceptibility," Health Economics, John Wiley & Sons, Ltd., vol. 26(6), pages 703-723, June.
    11. Farasat A.S. Bokhari & Franco Mariuzzo & Weijie Yan, 2019. "Antibacterial resistance and the cost of affecting demand: the case of UK antibiotics," Working Paper series, University of East Anglia, Centre for Competition Policy (CCP) 2019-03, Centre for Competition Policy, University of East Anglia, Norwich, UK..
    12. Stacherl, Barbara & Renner, Anna-Theresa & Weber, Daniela, 2023. "Financial incentives and antibiotic prescribing patterns: Evidence from dispensing physicians in a public healthcare system," Social Science & Medicine, Elsevier, vol. 321(C).
    13. Filippini, Massimo & Masiero, Giuliano & Moschetti, Karine, 2006. "Socioeconomic determinants of regional differences in outpatient antibiotic consumption: Evidence from Switzerland," Health Policy, Elsevier, vol. 78(1), pages 77-92, August.
    14. Albert, Jason, 2021. "Strategic dynamics of antibiotic use and the evolution of antibiotic-resistant infections," International Journal of Industrial Organization, Elsevier, vol. 77(C).
    15. Giuliano Masiero & Massimo Filippini & Matus Ferech & Herman Goossens, 2007. "Determinants of outpatient antibiotic consumption in Europe: bacterial resistance and drug prescribers," Quaderni della facoltà di Scienze economiche dell'Università di Lugano 0702, USI Università della Svizzera italiana.
    16. Thomas Heister & Christian Hagist & Klaus Kaier, 2017. "Resistance Elasticity of Antibiotic Demand in Intensive Care," Health Economics, John Wiley & Sons, Ltd., vol. 26(7), pages 892-909, July.
    17. Giuliano Masiero & Massimo Filippini & Matus Ferech & Herman Goossens, 2010. "Socioeconomic determinants of outpatient antibiotic use in Europe," International Journal of Public Health, Springer;Swiss School of Public Health (SSPH+), vol. 55(5), pages 469-478, October.
    18. Peter Collignon & Prema-chandra Athukorala & Sanjaya Senanayake & Fahad Khan, 2015. "Antimicrobial Resistance: The Major Contribution of Poor Governance and Corruption to This Growing Problem," PLOS ONE, Public Library of Science, vol. 10(3), pages 1-13, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Filippini, Massimo & Masiero, Giuliano & Moschetti, Karine, 2006. "Socioeconomic determinants of regional differences in outpatient antibiotic consumption: Evidence from Switzerland," Health Policy, Elsevier, vol. 78(1), pages 77-92, August.
    2. Markus Herrmann & Bruno Nkuiya, 2017. "Inducing optimal substitution between antibiotics under open access to the resource of antibiotic susceptibility," Health Economics, John Wiley & Sons, Ltd., vol. 26(6), pages 703-723, June.
    3. Belay, Dagim G. & Jensen, Jørgen D., 2020. "‘The scarlet letters’: Information disclosure and self-regulation: Evidence from antibiotic use in Denmark," Journal of Environmental Economics and Management, Elsevier, vol. 104(C).
    4. John B. Horowitz & H. Brian Moehring, 2004. "How property rights and patents affect antibiotic resistance," Health Economics, John Wiley & Sons, Ltd., vol. 13(6), pages 575-583, June.
    5. Brekke, Kurt R. & Holmas, Tor Helge & Straume, Odd Rune, 2011. "Reference pricing, competition, and pharmaceutical expenditures: Theory and evidence from a natural experiment," Journal of Public Economics, Elsevier, vol. 95(7), pages 624-638.
    6. Farasat A.S. Bokhari & Franco Mariuzzo & Weijie Yan, 2019. "Antibacterial resistance and the cost of affecting demand: the case of UK antibiotics," Working Paper series, University of East Anglia, Centre for Competition Policy (CCP) 2019-03, Centre for Competition Policy, University of East Anglia, Norwich, UK..
    7. Meredith B. Rosenthal & Ernst R. Berndt & Julie M. Donohue & Arnold M. Epstein & Richard G. Frank, 2003. "Demand Effects of Recent Changes in Prescription Drug Promotion," NBER Chapters, in: Frontiers in Health Policy Research, Volume 6, pages 1-26, National Bureau of Economic Research, Inc.
    8. John B. Horowitz & H. Brian Moehring, 2014. "How Economic Development Affects Antibiotic Resistance," Journal for Economic Educators, Middle Tennessee State University, Business and Economic Research Center, vol. 14(1), pages 58-77, Fall.
    9. Barlow, Euan & Morton, Alec & Megiddo, Itamar & Colson, Abigail, 2022. "Optimal subscription models to pay for antibiotics," Social Science & Medicine, Elsevier, vol. 298(C).
    10. Filippini, M. & Heimsch, F. & Masiero, G., 2014. "Antibiotic consumption and the role of dispensing physicians," Regional Science and Urban Economics, Elsevier, vol. 49(C), pages 242-251.
    11. Dagim G. Belay & Tenaw G. Abate & Jørgen Dejgaard Jensen, 2020. "A Montero Auction Mechanism to Regulate Antimicrobial Consumption in Agriculture," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(5), pages 1448-1467, October.
    12. Massimo Filippini & Giuliano Masiero & Karine Moschetti, 2008. "Dispensing practices and antibiotic use," Quaderni della facoltà di Scienze economiche dell'Università di Lugano 0808, USI Università della Svizzera italiana.
    13. David Granlund, 2022. "The Price Effects of Competition from Parallel Imports and Therapeutic Alternatives: Using Dynamic Models to Estimate the Causal Effect on the Extensive and Intensive Margins," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 60(1), pages 63-92, February.
    14. Klaus Kaier & S. Moog, 2012. "Economic Consequences of the Demography of MRSA Patients and the Impact of Broad-Spectrum Antimicrobials," Applied Health Economics and Health Policy, Springer, vol. 10(4), pages 227-234, July.
    15. Massimo Filippini & Giuliano Masiero & Karine Moschetti, 2007. "Characteristics of demand for antibiotics in primary care: an almost ideal model," Working Papers 0701, Department of Management, Information and Production Engineering, University of Bergamo.
    16. Catherine A. Goodman & Paul G. Coleman & Anne J. Mills, 2001. "Changing the first line drug for malaria treatment—cost‐effectiveness analysis with highly uncertain inter‐temporal trade‐offs," Health Economics, John Wiley & Sons, Ltd., vol. 10(8), pages 731-749, December.
    17. Filippini, M. & Masiero, G. & Moschetti, K., 2009. "Regional consumption of antibiotics: A demand system approach," Economic Modelling, Elsevier, vol. 26(6), pages 1389-1397, November.
    18. Niklas Rudholm, 2003. "Competition and substitutability in the Swedish pharmaceuticals market," Applied Economics, Taylor & Francis Journals, vol. 35(14), pages 1609-1617.
    19. David H. Howard, 2004. "Resistance‐induced antibiotic substitution," Health Economics, John Wiley & Sons, Ltd., vol. 13(6), pages 585-595, June.
    20. Bethany Cooper & Walter O. Okello, 2021. "An economic lens to understanding antimicrobial resistance: disruptive cases to livestock and wastewater management in Australia," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 65(4), pages 900-917, October.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:hlthec:v:12:y:2003:i:2:p:125-138. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/5749 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.