Health Care Expenditure and GDP: An International Panel Smooth Transition Approach

International Journal of Economics, Vol 4, No. 1, pp. 189-200, June 2010

21 Pages Posted: 28 Mar 2009 Last revised: 21 Jun 2010

See all articles by Mohamed Chakroun

Mohamed Chakroun

University of Sfax - Faculty of Economics and Management (FSEGS)

Date Written: 2010

Abstract

In this paper, we investigate the potential threshold effects in the relationship between national expenditures on health care and national income. Using a panel threshold regression model, we derive country-specific and time-specific income elasticities for 17 OECD countries over the period 1975-2003. In contrast to many previous analyses, our empirical results show that health care is a necessity rather than a luxury. Further, the relationship between health expenditure and income seems rather nonlinear, changing over time and across countries.

Keywords: Health Expenditure, Income Elasticity, Panel Smooth Threshold Regression Models

JEL Classification: C12

Suggested Citation

Chakroun, Mohamed, Health Care Expenditure and GDP: An International Panel Smooth Transition Approach (2010). International Journal of Economics, Vol 4, No. 1, pp. 189-200, June 2010. Available at SSRN: https://ssrn.com/abstract=1369153

Mohamed Chakroun (Contact Author)

University of Sfax - Faculty of Economics and Management (FSEGS) ( email )

Road of Airport, Km 4
3018 Sfax, 3018
Tunisia

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