Open AccessThe Dynamics of Disease in a Regulated Vertically Differentiated Health System
Author(s) -
Luca Lambertini,
Alessandro Tampieri
Publication year - 2016
Publication title -
review of economic analysis
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.101
H-Index - 1
ISSN - 1973-3909
DOI - 10.15353/rea.v7i2.1419
Subject(s) - duopoly , markov chain , dimension (graph theory) , quality (philosophy) , disease , economics , dynamics (music) , computer science , econometrics , microeconomics , statistical physics , mathematical economics , medicine , mathematics , physics , machine learning , pathology , quantum mechanics , cournot competition , acoustics , pure mathematics
We build up a differential game to investigate the interplay between the quality of health care and the presence of an evolving disease in a duopoly where patients are heterogeneous along the income dimension. We study the Markov perfect equilibrium, and we identify the admissible parameter region wherein price regulation achieves the twofold objectives of ensuring cares to all patients and heal all of them.