Vaccines between war and market

Abstract

This short paper presents a theoretical analysis that is intended to throw light on some issues related to the supply of vaccines in a context where producer countries are involved in armed conflicts. We present a simple model which combines elements of Hirshleifer-style economic analysis of conflict and microeconomic modelling of oligopolistic markets. In particular, we apply a simple Cournot duopoly model to two producer countries. Findings show that world supply of vaccines is indirectly and negatively affected by the existence of armed conflicts in a producer country that is involved in an armed conflict. Yet such negative impact on supply also increases the world price. In brief, participation of producer countries in armed conflicts turns out to be detrimental for global supply of vaccines.