Analysis of economic impacts of the Programa Farmacia Popular in Brazil

Abstract

The aim of this paper is to analyze the effect of Programa Farmácia Popular do Brasil (PFPB) on household expenditure allocation, macroeconomic aggregates, considering its direct and indirect effects. Therefore, we adopt a computable general equilibrium (CGE) model to estimate the effects generated by the program. The CGE model used for this study brings innovations needed in analyzing the topic: the disaggregation of the household consumption´s vector by income deciles, and the calibration of the direct impact of the program from household spending on medicines attended by PFPB. The main results of the simulations tend to be positive on income distribution, raising the welfare of the families of lower deciles in greater proportion than those of the upper deciles.