Improving Regulation for Innovation: Evidence from China’s Pharmaceutical Industry
Friday, October 27, 202312:00 PM - 1:20 PM (Pacific)
Goldman Room E409, Encina Hall
SCCEI Fall Seminar Series
Friday, October 27, 2023 | 12:00 pm -1:20 pm Pacific Time
Goldman Room E409, Encina Hall, 616 Jane Stanford Way
Improving Regulation for Innovation: Evidence from China’s Pharmaceutical Industry
This study investigates the extent to which improved regulation can foster innovation by analyzing the impact of a major regulatory reform implemented in 2015 on the quantity and quality of innovation in China's pharmaceutical industry. Inspired by regulatory practices in the US, the reform aimed to address application backlogs and reduce administrative waiting time for new drug development. Using data at the drug and firm levels, we uncover three main findings: (1) drug categories experiencing improved approval times witnessed a surge in investigational new drug applications; (2) while there existed little improvement in within-drug innovation quality, the reform stimulated shifts in firm composition, leading to the influx of innovative new firm and enhancing aggregate-level drug innovativeness; and (3) the market recognized the improvement in drug innovation, evidenced by changes in stock prices following new drug registrations. Our findings highlight the important relationship between innovation quantity and quality, influenced by firm composition. They also suggest that emerging markets can enhance their innovation potential by adopting regulatory approaches akin to frontier countries.
Please register for the event to receive email updates and add it to your calendar. Lunch will be provided.
About the Speaker
Ruixue Jia is an Associate Professor of Economics at the School of Global Policy and Strategy, UC San Diego. Her research interests lie at the intersection of economics, history, and politics. One area of her research examines elite formation and its influence, both in historical and contemporary contexts. Another focus of her work is uncovering the deep historical origins of economic development. In recent years, she has studied the ongoing transformation of China's manufacturing sector and expanded her research to encompass labor and technology-related issues.
Jia is affiliated with BREAD, CESifo, CEPR, and NBER. She also serves as the co-director of UCSD's China Data Lab, which aims to lead China studies into a new era where contextual knowledge is tested and corroborated by social science methods and data.
A NOTE ON LOCATION
Please join us in-person in the Goldman Conference Room located within Encina Hall on the 4th floor of the East wing.