Patent policy regulation and public health

This paper analyzes the impact of the trade-related aspects of intellectual property rights (TRIPS) agreement on social welfare, when the effects on public health are taken into account. In particular, we study how the new international patent policy affects social welfare through the availability of pharmaceutical products. Extending the model developed by Grossman and Lai (Am Econ Rev 94(5):1635–1653, 2004) on optimal patent protection, this paper examines the externality generated by the intellectual property rights enforcement on our definition of public health.