The elasticity of drugs demand in Colombia’s pharmaceutical market
DOI:
https://doi.org/10.17230/ecos.2013.36.7Keywords:
Elasticity, Pharmaceutics market, AIDS model, CointegrationAbstract
Based on a dynamic specification of the AIDS model arisen from cointegration techniques, this research estimated the elasticity of the intra-molecular, brand and generic demand for three tracer conditions: essential hypertension, diabetes and hyperlipidemia both in the non-profit and private Colombian market. The estimate of the intra-molecular demand elasticity allows us to conclude that both brand-name and generic drugs are inelastic to price changes, they are luxury goods according to expenditure elasticity and intra-molecular replacement seems to exist due to the elasticity of substitution.
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