International Price Discrimination: The Pharmaceutical Industry

World Development, Volume 14(9), 1986, pp-1141-1150

 Variables
P = Price index fro pharmaceuticals
GDPN = GDP per capita (index)
CV = Volume of consumption (index)
N = Population Index
CVN = Volume of per capita consumption(index)
PP = Patent protection (dummy)
IPC = Indirect price control (dummy)
DPC = Direct price control (dummy)

2
Dependent Variable: P
Included observations: 32
Variable Coefficient Std. Error t-Statistic Prob.
C 32.60491 6.310316 5.166922 0.0000
GDPN 1.664066 0.243317 6.839087 0.0000
CVN -0.879108 0.249179 -3.528020 0.0014
R-squared 0.704089 Mean dependent var 74.00219
Adjusted R-squared 0.683682 S.D. dependent var 34.75032
S.E. of regression 19.54433 Akaike info criterion 8.872308
Sum squared resid 11077.45 Schwarz criterion 9.009720
Log likelihood -138.9569 F-statistic 34.50130
Durbin-Watson stat 2.027163 Prob(F-statistic) 0.000000
3
Dependent Variable: LOG(P)
Included observations: 32
Variable Coefficient Std. Error t-Statistic Prob.
C 2.260433 0.234680 9.631981 0.0000
LOG(GDPN) 0.950964 0.130581 7.282571 0.0000
LOG(CVN) -0.445176 0.092315 -4.822375 0.0000
R-squared 0.710046 Mean dependent var 4.195927
Adjusted R-squared 0.690049 S.D. dependent var 0.489434
S.E. of regression 0.272484 Akaike info criterion 0.326584
Sum squared resid 2.153175 Schwarz criterion 0.463997
Log likelihood -2.225351 F-statistic 35.50790
Durbin-Watson stat 2.309605 Prob(F-statistic) 0.000000

4
Dependent Variable: P
Included observations: 32
Variable Coefficient Std. Error t-Statistic Prob.
C 34.02403 6.828262 4.982825 0.0000
GDPN 1.635279 0.250992 6.515267 0.0000
CVN -0.853099 0.255941 -3.333183 0.0024
N -0.041486 0.070895 -0.585175 0.5631
R-squared 0.707665 Mean dependent var 74.00219
Adjusted R-squared 0.676343 S.D. dependent var 34.75032
S.E. of regression 19.76975 Akaike info criterion 8.922652
Sum squared resid 10943.61 Schwarz criterion 9.105869
Log likelihood -138.7624 F-statistic 22.59347
Durbin-Watson stat 1.987904 Prob(F-statistic) 0.000000
5
Dependent Variable: LOG(P)
Included observations: 32
Variable Coefficient Std. Error t-Statistic Prob.
C 2.200697 0.283308 7.767851 0.0000
LOG(GDPN) 0.972494 0.143602 6.772144 0.0000
LOG(CVN) -0.460603 0.101725 -4.527906 0.0001
LOG(N) 0.014089 0.036178 0.389435 0.6999
R-squared 0.711608 Mean dependent var 4.195927
Adjusted R-squared 0.680709 S.D. dependent var 0.489434
S.E. of regression 0.276559 Akaike info criterion 0.383683
Sum squared resid 2.141575 Schwarz criterion 0.566900
Log likelihood -2.138922 F-statistic 23.03001
Durbin-Watson stat 2.316681 Prob(F-statistic) 0.000000
6
Dependent Variable: P
Included observations: 32
Variable Coefficient Std. Error t-Statistic Prob.
C 32.23089 6.452836 4.994841 0.0000
GDPN 1.650406 0.248600 6.638808 0.0000
CVN -0.821931 0.282889 -2.905486 0.0071
CV -0.111072 0.247096 -0.449508 0.6565
R-squared 0.706210 Mean dependent var 74.00219
Adjusted R-squared 0.674732 S.D. dependent var 34.75032
S.E. of regression 19.81889 Akaike info criterion 8.927617
Sum squared resid 10998.08 Schwarz criterion 9.110834
Log likelihood -138.8419 F-statistic 22.43534
Durbin-Watson stat 1.952217 Prob(F-statistic) 0.000000
7
Dependent Variable: LOG(P)
Included observations: 32
Variable Coefficient Std. Error t-Statistic Prob.
C 2.265582 0.238590 9.495731 0.0000
LOG(GDPN) 0.972082 0.143554 6.771552 0.0000
LOG(CVN) -0.474155 0.120431 -3.937148 0.0005
LOG(CV) 0.013836 0.036120 0.383056 0.7046
R-squared 0.711557 Mean dependent var 4.195927
Adjusted R-squared 0.680653 S.D. dependent var 0.489434
S.E. of regression 0.276583 Akaike info criterion 0.383858
Sum squared resid 2.141950 Schwarz criterion 0.567075
Log likelihood -2.141723 F-statistic 23.02434
Durbin-Watson stat 2.316561 Prob(F-statistic) 0.000000
8
Dependent Variable: P
Included observations: 32
Variable Coefficient Std. Error t-Statistic Prob.  
C 38.22131 6.387304 5.983951 0.0000
GDPN 1.433680 0.214395 6.687108 0.0000
CVN -0.594732 0.223947 -2.655679 0.0133
PP 7.311330 6.123084 1.194060 0.2432
IPC -11.38456 7.159258 -1.590187 0.1239
DPC -15.62864 6.932635 -2.254359 0.0328
R-squared 0.811223     Mean dependent var 74.00219
Adjusted R-squared 0.774920     S.D. dependent var 34.75032
S.E. of regression 16.48647     Akaike info criterion 8.610318
Sum squared resid 7066.896     Schwarz criterion 8.885143
Log likelihood -131.7651     F-statistic 22.34570
Durbin-Watson stat 2.192910     Prob(F-statistic) 0.000000
9
Dependent Variable: LOG(P)
Included observations: 32
Variable Coefficient Std. Error t-Statistic Prob.
C 2.502369 0.249347 10.03570 0.0000
LOG(GDPN) 0.794704 0.156524 5.077208 0.0000
LOG(CVN) -0.317919 0.116121 -2.737829 0.0110
PP 0.027913 0.107355 0.260006 0.7969
IPC -0.191334 0.115012 -1.663603 0.1082
DPC -0.126261 0.113056 -1.116802 0.2743
R-squared 0.759898 Mean dependent var 4.195927
Adjusted R-squared 0.713725 S.D. dependent var 0.489434
S.E. of regression 0.261870 Akaike info criterion 0.325425
Sum squared resid 1.782976 Schwarz criterion 0.600250
Log likelihood 0.793202 F-statistic 16.45747
Durbin-Watson stat 2.373787 Prob(F-statistic) 0.000000
10
 p c gdpn cvn pp ipc dpc (log(pf_5) - pf_6)

Dependent Variable: P
Included observations: 32
Variable Coefficient Std. Error t-Statistic Prob.  
C 35.02775 5.976611 5.860806 0.0000
GDPN 1.447370 0.195970 7.385672 0.0000
CVN -0.459956 0.211722 -2.172451 0.0395
PP 11.61338 5.857709 1.982580 0.0585
IPC -14.44967 6.657273 -2.170510 0.0397
DPC -21.90394 6.821572 -3.210981 0.0036
LOG(PF_5) - PF_6 -91.15641 36.77737 -2.478601 0.0203
R-squared 0.848462     Mean dependent var 74.00219
Adjusted R-squared 0.812092     S.D. dependent var 34.75032
S.E. of regression 15.06367     Akaike info criterion 8.453089
Sum squared resid 5672.857     Schwarz criterion 8.773719
Log likelihood -128.2494     F-statistic 23.32912
Durbin-Watson stat 1.997060     Prob(F-statistic) 0.000000
11
Test Equation:
Dependent Variable: P
Included observations: 32
Variable Coefficient Std. Error t-Statistic Prob.
C 33.26123 7.938707 4.189754 0.0003
GDPN 1.418327 0.218856 6.480641 0.0000
CVN -0.392584 0.279879 -1.402694 0.1735
PP 9.479985 6.516887 1.454680 0.1587
IPC -5.61195 8.656732 -0.642413 0.5267
DPC -22.14251 8.875642 -2.494750 0.0199
N 0.080007 0.089369 0.895238 0.3796
CV -0.405682 0.327809 -1.237555 0.2279
R-squared 0.822547 Mean dependent var 74.00219
Adjusted R-squared 0.770790 S.D. dependent var 34.75032
S.E. of regression 16.63701 Akaike info criterion 8.673454
Sum squared resid 6642.959 Schwarz criterion 9.039888
Log likelihood -130.7753 F-statistic 15.89248
Durbin-Watson stat 2.060946 Prob(F-statistic) 0.000000
12
 Equation 5 v/s Equation 5_1

Dependent Variable: P
Included observations: 32
Variable Coefficient Std. Error t-Statistic Prob.
C 34.82149 23.99423 1.451244 0.1597
GDPN -0.318368 1.923808 -0.165489 0.8699
CVN 0.293792 0.797411 0.368432 0.7158
PP -1.907561 11.65804 -0.163626 0.8714
IPC -3.695638 16.96291 -0.217866 0.8294
DPC -1.704718 20.12902 -0.084690 0.9332
Pf_5^2 0.008003 0.018732 0.427217 0.6730
Pf_5^3 -9.45E-06 7.84E-05 -0.120530 0.9051
R-squared 0.838471 Mean dependent var 74.00219
Adjusted R-squared 0.791359 S.D. dependent var 34.75032
S.E. of regression 15.87299 Akaike info criterion 8.579433
Sum squared resid 6046.844 Schwarz criterion 8.945867
Log likelihood -129.2709 F-statistic 17.79721
Durbin-Watson stat 2.613088 Prob(F-statistic) 0.000000
13
Dependent Variable: P
Included observations: 32
Variable Coefficient Std. Error t-Statistic Prob.
C 38.27388 5.867591 6.522929 0.0000
GDPN 1.526067 0.219302 6.958732 0.0000
CVN -0.644240 0.232868 -2.766549 0.0099
DPC -20.62435 6.767135 -3.047722 0.0050
R-squared 0.777801 Mean dependent var 74.00219
Adjusted R-squared 0.753994 S.D. dependent var 34.75032
S.E. of regression 17.23581 Akaike info criterion 8.648324
Sum squared resid 8318.049 Schwarz criterion 8.831541
Log likelihood -134.3732 F-statistic 32.67104
Durbin-Watson stat 1.976694 Prob(F-statistic) 0.000000
14
 Dependent Variable: LOG(P)
Included observations: 32

Variable Coefficient Std. Error t-Statistic Prob.  

C 2.382856 0.242288 9.834822 0.0000

LOG(GDPN) 0.871294 0.137407 6.340971 0.0000
LOG(CVN) -0.373447 0.101252 -3.688297 0.0010
DPC -0.171186 0.110076 -1.555157 0.1311

R-squared 0.733099     Mean dependent var 4.195927

Adjusted R-squared
S.E. of regression
Sum squared resid
Log likelihood
Durbin-Watson stat
15
0.704503     S.D. dependent var 0.489434
0.266055     Akaike info criterion 0.306237
1.981980     Schwarz criterion 0.489454
-0.899800     F-statistic 25.63600
2.249143     Prob(F-statistic) 0.000000