The Economics of Public Pharmacies: Quasi- and Experimental Evidence from Local Markets
28 November, 2018 13:00 hrs
“The Economics of Public Pharmacies: Quasi- and Experimental Evidence from Local Markets”
Abstract:
Policies to decrease the price of pharmaceuticals are highly debated but evidence about their effectiveness is scarce. We provide the first analysis of a policy that introduces public pharmacies selling pharmaceuticals at reduced prices in local markets in Chile. Using experimental and quasi-experimental methods, we present three findings. First, information about public pharmacies improves consumers’ knowledge of the choice set and knowledge about the attributes of alternatives. Second, the opening of a public pharmacy is associated with increased prices and reduced sales in nearby private pharmacies. Third, an analysis of voting decisions for the mayors who opened these pharmacies reveals a positive evaluation of this policy. We conclude that public pharmacies can change the functioning of pharmaceutical markets but information about alternatives is crucial.
Pontificia Universidad Católica de Chile
Location:
Sala de Consejo, Piso 4, Beauchef 851, Departamento de Ingeniería Industrial, U. de Chile
Speaker:
Felipe Gonzalez
MIPP Chile 2024