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Estimating the Fiscal Effects of Public Pharmaceutical Expenditure Reduction in Greece.

Souliotis K, Papageorgiou M, Politi A, Frangos N, Tountas Y - Front Public Health (2015)

Bottom Line: The purpose of the present study is to estimate the impact of pharmaceutical spending reduction on public revenue, based on data from the national health accounts as well as on reports of Greece's organizations.In the second part, we perform a quantitative analysis for the estimation of multiplier effects of public pharmaceutical expenditure reduction on main revenue sources, such as taxes and social contributions.According to the results, nearly half of the gains from the measure's application is offset by financially equivalent decreases in the government's revenue, i.e., losses in tax revenues and social security contributions alone, not considering any other direct or indirect costs.

View Article: PubMed Central - PubMed

Affiliation: Faculty of Social and Political Sciences, University of Peloponnese , Corinth , Greece.

ABSTRACT
The purpose of the present study is to estimate the impact of pharmaceutical spending reduction on public revenue, based on data from the national health accounts as well as on reports of Greece's organizations. The methodology of the analysis is structured in two basic parts. The first part presents the urgency for rapid cutbacks on public pharmaceutical costs due to the financial crisis and provides a conceptual framework for the contribution of the Greek pharmaceutical branch to the country's economy. In the second part, we perform a quantitative analysis for the estimation of multiplier effects of public pharmaceutical expenditure reduction on main revenue sources, such as taxes and social contributions. We also fit projection models with multipliers as regressands for the evaluation of the efficiency of the particular fiscal measure in the short run. According to the results, nearly half of the gains from the measure's application is offset by financially equivalent decreases in the government's revenue, i.e., losses in tax revenues and social security contributions alone, not considering any other direct or indirect costs. The findings of multipliers' high value and increasing short-term trend imply the measure's inefficiency henceforward and signal the risk of vicious circles that will provoke the economy's deprivation of useful resources.

No MeSH data available.


Projection of the multiplier based on linear trend, exponential growth curve, and quadratic trend models.
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Figure 4: Projection of the multiplier based on linear trend, exponential growth curve, and quadratic trend models.

Mentions: Results based on Eqs 3–5 are depicted in Figure 4. According to the linear and exponential growth trends, the multiplier exceeds 0.5 in 2015, which implies the counterbalance of PPE curtailment by 50% at least. With the quadratic model, the multiplier reaches and exceeds the value 1.0 in 2014 and 2015, respectively.


Estimating the Fiscal Effects of Public Pharmaceutical Expenditure Reduction in Greece.

Souliotis K, Papageorgiou M, Politi A, Frangos N, Tountas Y - Front Public Health (2015)

Projection of the multiplier based on linear trend, exponential growth curve, and quadratic trend models.
© Copyright Policy
Related In: Results  -  Collection

License
Show All Figures
getmorefigures.php?uid=PMC4553366&req=5

Figure 4: Projection of the multiplier based on linear trend, exponential growth curve, and quadratic trend models.
Mentions: Results based on Eqs 3–5 are depicted in Figure 4. According to the linear and exponential growth trends, the multiplier exceeds 0.5 in 2015, which implies the counterbalance of PPE curtailment by 50% at least. With the quadratic model, the multiplier reaches and exceeds the value 1.0 in 2014 and 2015, respectively.

Bottom Line: The purpose of the present study is to estimate the impact of pharmaceutical spending reduction on public revenue, based on data from the national health accounts as well as on reports of Greece's organizations.In the second part, we perform a quantitative analysis for the estimation of multiplier effects of public pharmaceutical expenditure reduction on main revenue sources, such as taxes and social contributions.According to the results, nearly half of the gains from the measure's application is offset by financially equivalent decreases in the government's revenue, i.e., losses in tax revenues and social security contributions alone, not considering any other direct or indirect costs.

View Article: PubMed Central - PubMed

Affiliation: Faculty of Social and Political Sciences, University of Peloponnese , Corinth , Greece.

ABSTRACT
The purpose of the present study is to estimate the impact of pharmaceutical spending reduction on public revenue, based on data from the national health accounts as well as on reports of Greece's organizations. The methodology of the analysis is structured in two basic parts. The first part presents the urgency for rapid cutbacks on public pharmaceutical costs due to the financial crisis and provides a conceptual framework for the contribution of the Greek pharmaceutical branch to the country's economy. In the second part, we perform a quantitative analysis for the estimation of multiplier effects of public pharmaceutical expenditure reduction on main revenue sources, such as taxes and social contributions. We also fit projection models with multipliers as regressands for the evaluation of the efficiency of the particular fiscal measure in the short run. According to the results, nearly half of the gains from the measure's application is offset by financially equivalent decreases in the government's revenue, i.e., losses in tax revenues and social security contributions alone, not considering any other direct or indirect costs. The findings of multipliers' high value and increasing short-term trend imply the measure's inefficiency henceforward and signal the risk of vicious circles that will provoke the economy's deprivation of useful resources.

No MeSH data available.