Waste Not, Want Not: The Efficiency of Health Expenditure in Emerging and Developing Economies

20 Pages Posted: 23 Jan 2018

See all articles by Francesco Grigoli

Francesco Grigoli

International Monetary Fund (IMF)

Javier Kapsoli

International Monetary Fund (IMF)

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Date Written: February 2018

Abstract

Public health spending is low in emerging and developing economies relative to advanced economies and health outputs and outcomes need to be substantially improved. Simply increasing public expenditure in the health sector, however, may not significantly affect health outcomes if the efficiency of this spending is low. This paper quantifies the inefficiency of public health expenditure and the associated potential gains for emerging and developing economies using a stochastic frontier model that controls for the socioeconomic determinants of health, and provides country‐specific estimates. The results suggest that African economies have the lowest efficiency. At 2009 spending levels, they could boost life expectancy up to about 5 years if they followed best practices.

Suggested Citation

Grigoli, Francesco and Kapsoli, Javier, Waste Not, Want Not: The Efficiency of Health Expenditure in Emerging and Developing Economies (February 2018). Review of Development Economics, Vol. 22, Issue 1, pp. 384-403, 2018. Available at SSRN: https://ssrn.com/abstract=3107344 or http://dx.doi.org/10.1111/rode.12346

Francesco Grigoli (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Javier Kapsoli

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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