April, Thuesday 30 th 2024

 Biliana Yontcheva (DICE) will present “ Chain formation and consumer welfare on the retail pharmacy market ”.

Abstract:

This paper evaluates the effect of deregulated ownership and horizontal integration on the retail pharmacy market. Using data on the full population of reimbursed prescriptions in Slovakia in 2017, we examine whether outlets of pharmacy chains perform better than their independent counterparts in terms of consumer preferences and operating costs. Our preliminary findings indicate that consumers perceive pharmacy chains as having higher quality on average than independent outlets, although there is substantial heterogeneity in the effects, both across chain brands and across consumer types. We do not find evidence for substantial productivity gains due to chain affiliation, suggesting that growth in the sector is mainly driven by selective takeovers in locations with high economies of scale.