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Arrow Award

iHEA’s Kenneth J. Arrow Award was created to recognize excellence in the field of health economics with the Award presented to the author(s) of the paper judged to be the best paper published in health economics in English in the award year. The Award was set up in honor of Kenneth Arrow and in recognition of the influence of his seminal paper from 1963 “Uncertainty and the welfare economics of medical care”. Professor Arrow was involved in the creation of the Award and he presented the inaugural prize in 1993.

The Award is made every year. Each year the Award committee consider a short-list of up to ten papers, with each paper evaluated by all of the committee members in terms of importance and originality of contribution, appropriateness and innovation in methodology and clarity of presentation.

The winner is presented with a plaque at the iHEA congress when held in the same year as the award, or at a special reception at the AEA conference in years when there is no iHEA congress.


Most recent Award Winner

The 24th Arrow Award for the best paper in health economics was awarded to Eric Budish, Benjamin N. Roin and Heidi Williams for their paper “Do firms underinvest in long-term research? Evidence from cancer clinical trials” American Economic Review 105(7): 2044-2085, 2015.

The Arrow Award Committee acknowledged the authors of this innovative and policy-relevant paper which asks how many lives are lost due to short-termism and patent distortions of private research investment decisions by the pharmaceutical industry. The premise is that investments in R&D are skewed towards late-stage cancer treatments, which require shorter clinical trials, than early-stage treatments or prevention. Shorter trials allow the late-stage drugs to be brought to market more quickly, lengthening the effective patent term for these new drugs. The paper addresses a fundamental and policy relevant question and brings together a range of approaches that distinguish excellence in health economics research. A tailored theoretical model is developed to define the problem, its consequences for social welfare and the policy options available. Information from clinical trials registries is drawn together to create a novel dataset.  New evidence is provided by these data that R&D investments are negatively correlated with commercialization lags. This empirical finding is given careful scrutiny to check whether it provides robust evidence of a causal mechanism. Three policy options are explored: allowing use of surrogate (non-mortality) endpoints in clinical trials, redesigning the patent system to start the clock at commercialization, and providing public subsidy for projects with long lags.

The Committee also made honorable mention of:

Katherine Baicker, Sendhil Mullainathan and Joshua Schwartzstein “Behavioral hazard in health insurance” Quarterly Journal of Economics (2015) 1623-1667.


Committee Membership 2017

Membership of the Arrow Award Committee is refreshed each year and members can serve for up to two three-year terms.

Chair: Christopher Ruhm, University of Virginia, USA

Co-Chair: Luigi Siciliani, University of York, UK


Term Expires at the end of 2017:

*Ana Balsa, Universidad de Montevideo, Uruguay

Anne Case, Princeton University, USA

Jonathan Kolstad, University of California, Berkeley, USA

Joachim Winter,  Ludwig-Maximilians-Universität München, Germany

Winnie Yip, University of Oxford, UK / Harvard University, USA


Term Expires at the end of 2018:

Jeffrey Clemens, University of California San Diego, USA

*Sherry Glied, Columbia University, USA

Joshua Gottlieb, University of British Columbia, Canada

*Petter Lundborg, Lund University, Sweden

*Tony Scott, University of Melbourne, Australia


Term Expires at the end of 2019:

Joan Costa-i-Font, London School of Economics, UK

* Brigitte Dormont, Université Paris Dauphine, France

* Kate Ho, Columbia University, USA

* Jui-fen Rachel Lu, Chang Gung University, Taiwan

Rodrigo R. Soares, Columbia University, USA

(* = 2nd and final term)




Winning Paper



Eric Budish, Benjamin N. Roin and Heidi Williams. 2015. Do firms underinvest in long-term research? Evidence from cancer clinical trials.American Economic Review105(7): 2044-2085.



Jeffrey Clemens and Joshua D. Gottlieb. 2014. Do Physicians' Financial Incentives Affect Treatment Patterns and Patient Health? American Economic Review104(4): 1320-49.



Jonathan T. Kolstad. 2013. Information and quality when motivation is intrinsic: evidence from surgeon report cards. American Economic Review,103(7):2875-2910.



Amy Finkelstein, Sarah Taubman, Bill Wright, Mira Bernstein, Jonathan Gruber, Joseph P. Newhouse, Heidi Allen, Katherine Baicker, and the Oregon Health Study Group. 2012. The Oregon Health Insurance Experiment: Evidence from the First Year. Quarterly Journal of Economics, 127(3):1057-1106



Randall D. Cebul, James B. Rebitzer, Lowell J. Taylor, Mark E. Votruba. 2011. Unhealthy Insurance Markets: Search Frictions and the Cost and Quality of Health Insurance. American Economic Review,101(5):1842-71



Carol Propper and John Van Reenen. 2010. Can pay regulation kill? Panel Data Evidence on the Effect of Labor Markets on Hospital Performance. Journal of Political Economy, 118(2): 222-273



Kate Ho. 2009. Insurer-Provider Networks in the Medical Care Market. American Economic Review,99(1):393-430



Hanming Fang, Michael P. Keane, and Dan Silverman. 2008. Sources of Advantageous Selection: Evidence from the Medigap Insurance Market. Journal of Political Economy, 116(2): 303-350.



Amitabh Chandra and Doug Staiger. 2007. Productivity Spillovers in Health Care: Evidence from the Treatment of Heart Attacks. Journal of Political Economy, 115: 103-140.



Kevin M. Murphy and Robert H. Topel. 2006. The Value of Health and Longevity. Journal of Political Economy, 114(5): 871-904.



Gary S. Becker, Tomas J. Philipson, and Rodrigo R. Soares. 2005. The Quantity and Quality of Life and the Evolution of World Inequality. American Economic Review, 95(1):277-291



Edward Miguel and Michael Kremer. 2004. Worms: Identifying impacts on education and health in the presence of treatment externalities. Econometrica, 72(1); 159-217.



Kenneth Chay and Michael Greenstone. 2003. The Impact of Air Pollution on Infant Mortality: Evidence from Geographic Variation in Pollution Shocks Induced by a Recession. Quarterly Journal of Economics, 118(3):1121-1167.



Anne Case, Darren Lubotsky and Christina Paxson. 2002. Economic Status and Health in Childhood: The Origins of the Gradient. American Economic Review; 92(5): 1308-1334.



Willard G. Manning and John Mullahy. 2001. Estimating Log Models: To Transform or Not to Transform? Journal of Health Economics, 20(4): 461–494



David M. Cutler, Mark McClellan and Joseph P. Newhouse. 2000. How Does Managed Care Do It? Rand Journal of Economics, 31(3): 526–548



Will Dow, Tomas J. Philipson and Xavier Sala-i-Martin. 1999. Longevity Complementarities Under Competing Risks. American Economic Review,89(5):1358-1371.



Donna B. Gilleskie. 1998. A Dynamic Stochastic Model of Medical Care Use and Work Absence. Econometrica, 66(1): 1-45.



Ching-To Albert Ma and Thomas G. McGuire. 1997. Optimal Health Insurance and Provider Payment. American Economic Review,87(4): 685-704.



Daniel Kessler and Mark McClellan. 1996. Do Doctors Practice Defensive Medicine? Quarterly Journal of Economics, 111(2): 353-390.



Martin Gaynor and Paul Gertler. 1995. Moral Hazard and Risk Spreading in Partnerships. RAND Journal of Economics, 26(4): 591-613.



Jonathan Gruber. 1994. The Incidence of Mandated Maternity Benefits. American Economic Review, 84(3): 622-641



Phillip Cook and Michael Moore. 1993. Drinking and schooling. Journal of Health Economics, 12(4): 411-429.



Richard Hirth. 1992. Nursing Home Quality: Roles of Information and Ownership (Unpublished paper)


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The International Health Economics Association was formed to increase communication among health economists, foster a higher standard of debate in the application of economics to health and health care systems, and assist young researchers at the start of their careers.

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