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The Allocation of Publicly Funded Biomedical Research

The Allocation of Publicly Funded Biomedical Research

(p.565) 15 The Allocation of Publicly Funded Biomedical Research
Medical Care Output and Productivity
Frank R. Lichtenberg
University of Chicago Press

In the last century, the average health of the American people has improved dramatically. The mean life expectancy of Americans has increased almost twenty years, or two years per decade, since the turn of the century. Just from 1979 to 1988, the age-adjusted mortality rate declined 7.2 percent. An important part of this enormous progress in health is probably due to large private and public investments in biomedical research. In 1993, research and development (R&D) in the health care sector accounted for 18 percent of total R&D expenditure in the United States. The National Institutes of Health (NIH) administer about 80 percent of federal health R&D and places a high priority on funding basic research. This chapter describes a simple theoretical model of the allocation of the applied component of public biomedical research expenditure — the approximately 50 percent of expenditure that is of direct, near-term relevance to specific diseases — and presents some empirical evidence about the determinants of this budget allocation.

Keywords:   biomedical research, funding, budget allocation, National Institutes of Health, United States, diseases, research and development, mortality

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