title: Induced Innovation and Social Inequality: Evidence from Infant Medical Care.
abstract: We develop a model of induced innovation that applies to medical research. Our model yields three empirical predictions. First, initial death rates and subsequent research effort should be positively correlated. Second, research effort should be associated with more rapid mortality declines. Third, as a byproduct of targeting the most common conditions in the population as a whole, induced innovation leads to growth in mortality disparities between minority and majority groups. Using information on infant deaths in the U.S. between 1983 and 1998, we find support for all three empirical predictions.
authors.affiliation: Otto Eckstein Professor of Applied Economics at Harvard University and a Research Associate at the National Bureau of Economic Research.
authors.forename: David M
authors.initials: DM
authors.lastname: Cutler
authors.affiliation: Associate Professor at The Dartmouth Institute for Health Policy and Clinical Practice and a Faculty Research Fellow at the National Bureau of Economic Research.
authors.forename: Ellen
authors.initials: E
authors.lastname: Meara
authors.affiliation: Assistant Professor of Economics and Public Policy at Carnegie Mellon University.
authors.forename: Seth
authors.initials: S
authors.lastname: Richards-Shubik