Article: Do Economies of Scale Exist in the Pharmaceutical Industry? Journal: Journal of Business and Management (JBM) 1995 Vol.2 No.2 pp.96 - 113 Abstract: To determine whether the pharmaceutical industry becomes more efficient as it grows larger, economies of scale were measured with a translog multi-product statistical cost function. Returns to two outputs -research and development and sales- revealed that overall firms are characterized by diseconomies of scale. But, firms of all sizes experience increasing returns as their research efforts grow larger. Inderscience Publishers - linking academia, business and industry through research

Title: Do Economies of Scale Exist in the Pharmaceutical Industry?

Authors: Susan A. Simmons

Addresses: Author address listing can be found in the "About the Authors" section at the end of the article.

Abstract: To determine whether the pharmaceutical industry becomes more efficient as it grows larger, economies of scale were measured with a translog multi-product statistical cost function. Returns to two outputs -research and development and sales- revealed that overall firms are characterized by diseconomies of scale. But, firms of all sizes experience increasing returns as their research efforts grow larger.

Keywords: Pharmaceutical industry; economies of scale; diseconomies of scale; cost function.

DOI: 10.1504/JBM.1995.141005

Journal of Business and Management, 1995 Vol.2 No.2, pp.96 - 113

Published online: 05 Sep 2024 *

Title: Do Economies of Scale Exist in the Pharmaceutical Industry?

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