Behavioural economics – Monopoly, patents and loss of consumer surplus regarding pharmaceutical companies
The intuition of monopoly and of patents as a ‘temporary monopoly’ for drug companies to make their profits back
Discuss the inefficiency of monopoly in terms of loss of consumer surplus by using a diagram in order to argue that from a static perspective awarding patents as a reward for successful innovation is not the most efficient reward.
Welfare effects of monopoly:
Describe the diagram and apply any other relevant diagrams
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