November 20, 2003

Voting to Kill Canadians II

Well, it looks like Canada has opted to create an open border where their cheap drugs can be exported without limit. Supply and demand rules means that US low price seekers are about to drain Canada's drug supplies down to zero. Will US drug makers provide unlimited resupply and cut their own throats? I don't think so. End result, a reasonably quick shortage if the US fails to keep the import walls up. It's the law of supply and demand 101. Price arbitrage will create shortages reducing supply until the price rises to the market clearing level. Where that level is above the maximum price set by the provinces, there will be insufficient drugs left to meet demand.

Hat tip to Chip Taylor.

Posted by TMLutas at November 20, 2003 04:57 PM