Bio
Matthew Grennan is an economist who studies competition and innovation, using empirical and theoretical models from industrial organization. His research and teaching examine how incentives and information affect how products are developed, adopted, priced, and ultimately deliver value for stakeholders and society. He has particularly extensive experience in life sciences, medical technology, and health care. His work has informed business strategy and policy debates regarding price transparency, relationships between physicians and industry, regulation of new products, and antitrust. He has also developed multiple courses on data analytics and the application of machine learning and causal inference methods in business and public policy.
Grennan is a Research Associate at the National Bureau of Economic Research and an Editor at the Journal of Political Economy Microeconomics. He is currently Acting Associate Professor of Economics at Emory University, on leave from the Haas School of the University of California, Berkeley where he held the Robinson Chancellor’s Chair and was Faculty Co-Director of the Robinson Life Science, Business, and Entrepreneurship Program. He was previously on the faculty at Wharton and Toronto and received his PhD from NYU Stern in Economics and Business Strategy.
Professor Grennan’s research has been published in the top general interest journals in economics, management, and policy, including the American Economic Review, Management Science, and Health Affairs. He has received funding from leading institutions such as the National Science Foundation and National Institute for Health Care Management.
​
Professor Grennan teaches at the undergraduate, MS, MBA, PhD, and Executive Education levels in the areas of industrial organization, cost-benefit analysis, entrepreneurship, data analytics, technology strategy, and marketing. He has received teaching awards from Berkeley, Wharton, Toronto, and Poets & Quants.
Professor Grennan has advised and presented before government bodies on issues such as estimating market power in innovative industries, modeling pricing with bargaining, efficiencies in hospital mergers, and the robustness of the medical supply chain. He has also advised numerous start-ups and provided consulting services to companies such as Medtronic. He is a Senior Consultant to Compass Lexecon and has provided written and verbal testimony as an expert witness in litigation matters involving antitrust, class action damages, intellectual property, and merger contract disputes for clients such as Abbott, CVS, U.S. Department of Justice, Johnson & Johnson, and Walmart.
Matthew Grennan
Research
“Lobbying Physicians: Payments from Industry and Hospital Procurement of Medical Devices”, with Alon Bergman and Ashley Swanson
Newly merged administrative data sets for ten large device categories 2014-17 show payments from device firms to physicians are pervasive and highly correlated with spending within a firm-hospital pair. Event studies suggest that a large positive increase in payments to a given hospital from a given firm is associated with 27 percent higher expenditures on the paying firm’s devices post-event. Even after controlling for patient mix, payments to hospitals outside the top Academic Medical Centers (AMCs, a potential expert benchmark) are correlated with larger deviations from the procurement patterns of top AMC hospitals.
“No Free Lunch? Welfare Analysis of Firms Selling Through Expert Intermediaries” Accepted @ Review of Economic Studies, with Kyle Myers, Ashley Swanson, and Ronnie Chatterji
We develop a model where targeted payments from manufacturers have different estimated effects on prescribing for different doctors, prescribing can be biased at baseline, and prices are negotiated between payers and upstream suppliers. In estimates using market and clinical data for statins 2011-12, AMC policy spillovers identify heterogenous payment effects, and payments are beneficial on net because they counteract under-prescribing.
​
Media: The Fix, LDI, MarketWatch
“Spillovers Across Categories in the Medical Device Industry” R&R @ Journal of Economics Management and Strategy, with Charu Gupta and Mara Lederman
Responses to new product introductions suggest that buyer-level spillovers represent up to half of all potential demand spillovers and one-third of the overall correlation in supplier shares across categories, with implications for firm strategy and antitrust policy for firms selling in multiple product categories.
“Medical Device Firm Payments To Physicians Exceed What Drug Companies Pay Physicians, Target Surgical Specialists” Health Affairs (2021), with Alon Bergman and Ashley Swanson
Relative to drug firm payments, device firm payments were: seven times as large as a percentage of industry revenue, more often related to product development and training, and more strongly correlated with physicians’ Medicare billing amounts. Top-paying firms dominate the most prominent device categories.
Media: Stat
“Mergers and Marginal Costs: New Evidence on Hospital Buyer Power” RAND Journal of Economics (2021), with Stuart Craig and Ashley Swanson
Mergers among a sample of US Hospitals 2009-15 result in little to no costs savings on average, despite large expected opportunities for such. Savings, when they occur, tend to be local, and offset by managerial costs of merging.
Media: NBER Digest, Advisory Board, Modern Healthcare, Daily Caller, Axios
“Transparency and Negotiated Prices: The Value of Information in Hospital-Supplier Bargaining” Journal of Political Economy (2020), with Ashley Swanson
Across a large number of important product categories, access to information on purchasing by peer hospitals leads to reductions in the prices hospitals negotiate for supplies. Asymmetric information about seller willingness to concede finds stronger support than a purchasing manager agency mechanism. Transparency decreases high prices, but does not affect low prices.
Media: NYTimes, LDI, Knowledge@Wharton
“Regulating Innovation with Uncertain Quality: Information, Risk, and Access in Medical Devices” American Economic Review (2020), with Bob Town
Product testing can reduce consumer uncertainty, but also increase entry costs and delay entry. In a stent case study, no monitoring would severely depress demand; "post-market" monitoring would maximize welfare.
​
Media: AEA Research Blog, LDI, Knowledge@Wharton, LSE Business Review
​
PURC Prize for Best Paper in Regulatory Economics (2018)
“Bargaining Ability and Competitive Advantage: Empirical Evidence from Medical Devices” Management Science (2014)
Prices vary widely across buyers of the same product. A structural model of demand and negotiated prices disentangles bargaining position variation due to heterogeneous preferences from bargaining abilities. Variation in bargaining abilities explains 79% of the price variation. Bargaining ability also has a large firm-specific component.
"Price Discrimination and Bargaining: Empirical Evidence from Medical Devices" American Economic Review (2013)
Bargaining generalizes the traditional price competition model, fits this data better, and interacts with competitive effects in counterfactuals. Allowing different prices to different buyers can increase competition, so group purchasing must increase bargaining ability to compensate.
Teaching
HC Data Analytics
great mix of health data landscape, practicing data analytics in R, and bringing in experts to share their experience
Med Tech Strategy
can't imagine a better-designed course to take before entering the medical devices industry
HC Entrepreneurship
totally changed the way I think and approach problems and business