Healthcare Markets: The Evolution of Regulation, Competition, and Innovation

Now more than ever before, not only medical issues but also economic and social issues influence how health care is organized, governed, financed, and delivered.

Our empirical research advances understanding of the economics and regulation of the healthcare industry, with an emphasis on the biopharmaceutical and medical device industries. Faculty researchers examine a variety of issues, most typically around firm, industry, and regulatory organization and performance. Past and ongoing research includes the speed of drug development, sales and promotion strategies during adverse regulatory events, regulatory compliance, healthcare payment reform, and the effect of eHealth on health behaviors and outcomes. Some research projects entail the development and analysis of proprietary data, while others are conducted in collaboration with the U.S. Food and Drug Administration (FDA), the Centers for Medicare and Medicaid Services (CMS), and the Centers for Disease Control and Prevention (CDC).

Principal Investigator and Convener: Jeffrey Macher


Yunan Ji published a paper entitled “Provision of Hospital Price Information After Increases in Financial Penalties for Failure to Comply With a US Federal Hospital Price Transparency Rule” in JAMA Network Open in June 2023. The paper finds that financial penalties were effective in improving hospital compliance with the 2021 Centers for Medicare & Medicaid Services (CMS) Price Transparency Rule. Additionally, Ms. Ji presented a working paper entitled “The Dynamic Effects of Health Care Price Reform” at the BFI IO+ Conference at the University of Chicago in September 2023. The paper studies the impact of Medicare price regulation on medical device innovation, market structure, and product quality.

Jeff Macher presented a working paper entitled, “Unpacking the ‘Black Box’ of Strategy: Firm and Competitive Responses to Adverse Regulatory Events” at the Strategic Management Society (SMS) Conference in Toronto, CA in October, 2003. The paper examines the effects of an adverse regulatory event (a black box warning) on pharmaceutical firms’ responses via sales visit and promotion strategies and their subsequent performance. Black box warnings are medication-related safety warnings that appear on package inserts of prescription drug products that indicate major drug-related risks. Sales visits and promotion strategies are the efforts by sales representatives to market or otherwise promote drugs directly to primary care physicians (PCPs). Utilizing a combination of publicly-available FDA data on black box warnings and proprietary data on pharmaceutical firms’ sales visit and promotion strategies and PCPs’ written prescriptions, the paper documents how firms reposition their sales visit and promotion strategies when they or their rivals face black box warnings, as well as the market share performance effects.

Anita Rao presented “The Impact of Voluntary Labeling”, with Raluca Ursu at the 12th Triennial Invitational Choice Symposium, INSEAD, August 2023. The paper examines how front-of package voluntary claims can mislead consumers into buying something that is unhealthy for them. The research looked at the context of “no high fructose corn syrup” label and the sugar content of consumer packaged goods. The paper was awarded the MSI Research Grant in December 2022.


Yunan Ji

Jeffrey Macher

  • “Regulator Heterogeneity and Endogenous Efforts to Close the Information Asymmetry Gap.” Journal of Law and Economics, 2011
  • “Technological Development at the Boundaries of the Firm: A Knowledge-Based Examination in Drug Development.” Strategic Management Journal 2012
  • “An Innovation Silver Lining: Product Recalls and New Product Submissions in the Medical Device Industry.” (working paper).

Anita Rao

  • “Industry-funded Research and Bias in Food Science,” Quantitative Marketing and Economics, 2022.
  • “Deceptive Claims using Fake News Advertising: The Impact on Consumers,” Journal of Marketing Research, 2022
  • “Do Made in USA Claims Matter?,” Marketing Science, 2021.


Yunan Ji

  • The Dynamic Effects of Health Care Price Reform,”
    BFI IO+ Conference, University of Chicago. September 2023.
  • Can Competitive Bidding Work in Health Care? Evidence from Medicare Durable Medical Equipment,
    CBO IO Seminar, Congressional Budget Office. March 2023.
    NBER Health Care Program Meeting, National Bureau of Economic Research. February 2023.
  • Fifteenth Annual Federal Trade Commission Microeconomics Conference, 2022

Anita Rao

  • “The Impact of Voluntary Labeling”, with Raluca Ursu
    12th Triennial Invitational Choice Symposium, INSEAD, August 2023
    Behavioral Industrial organization & Marketing Symposium, May 2023
  • “Debunking Misinformation about Consumer Products: Effects on Beliefs and Purchase Behavior,” with Jessica Fong and Tong Guo
    Life Sciences Economics Seminar Series, Charles River Associates, Feb 2023
  • “Information or Obfuscation? The case of the “no High Fructose Corn Syrup” label”
    Stanford GSB Quant Marketing Alumni Conference, Apr 2022
  • “Debunking Misinformation in Advertising” 
    McDonough School of Business, Georgetown University, Nov 2021
  • “Industry-funded Research and Bias in Food Science”
    Mendoza College of Business, University of Notre Dame, Oct 2021

Jeffrey Macher

  • “Recalls and New Product Development: Own Firm Distractions and Competitor Firm Opportunities”
    University of North Carolina (Kenan-Flagler) Strategy & Entrepreneurship Seminar, 2021
    University of Utah (Eccles School of Business) Strategy Seminar (MAR 2020)
  • “When is Organization Inefficient? A Knowledge-Based Examination in Medical Device Manufacturing,”
    Industry Studies Association (ISA) Conference (2020)
  • “Does the Internet Improve Consumer Healthcare Behaviors?”
    University of Pennsylvania — Leonard Davis Institute Seminar Series (2018)