Pharmaceuticals and multi-layered government-granted monopoly

Mylan’s price increase of the EpiPen in late August has caused consternation and a lot of debate about the reasons why Mylan has been able to increase the EpiPen price so dramatically above its production cost. Don’t forget that production cost includes the time and resources that comprise FDA compliance costs, even for generics like … More Pharmaceuticals and multi-layered government-granted monopoly

Cass Sunstein on regulatory analysis and the knowledge problem

Cass Sunstein begins: With respect to the past and future of regulation, there are two truly indispensable ideas. Unfortunately, they are in serious tension with one another. Potential solutions lie in three reforms, all connected with democracy itself – but perhaps not quite in the way that most people think. The first indispensable idea is … More Cass Sunstein on regulatory analysis and the knowledge problem

Technological change, culture, and a “social license to operate”

Technological change is disruptive, and in the long sweep of human history, that disruption is one of the fundamental sources of economic growth and what Deirdre McCloskey calls the Great Enrichment: In 1800 the average income per person…all over the planet was…an average of $3 a day. Imagine living in present-day Rio or Athens or … More Technological change, culture, and a “social license to operate”

Geoff Manne in Wired on FCC Title II

Friend of Knowledge Problem Geoff Manne had a thorough opinion piece in Wired yesterday on the FCC’s Title II Internet designation. Well worth reading. From the “be careful what you wish for” department: Title II (which, recall, is the basis for the catch-all) applies to all “telecommunications services”—not just ISPs. Now, every time an internet … More Geoff Manne in Wired on FCC Title II

Why does a theory of competition matter for electricity regulation?

For the firms in regulated industries, for the regulators, for their customers, does the theory underlying the applied regulation matter? I think it matters a lot, even down in the real-world trenches of doing regulation, because regulation’s theoretical foundation influences what regulators and firms do and how they do it. Think about a traditional regulated … More Why does a theory of competition matter for electricity regulation?