Is Health Care Expenditure Really a Luxury Good? Re-Assessment and New Evidence Based on OECD Data

24 Pages Posted: 13 Feb 2013

See all articles by Vincenzo Atella

Vincenzo Atella

University of Rome Tor Vergata - Centre for International Studies on Economic Growth (CEIS); Department of Economics and Finance; University of Rome Tor Vergata - Faculty of Economics

Giorgia Marini

University of Rome La Sapienza

Date Written: November 2006

Abstract

The aim of the paper is to present new evidence on the relationship between income and health care expenditure allowing for (i) substitution and complementary relationships between private and public health care expenditure, (ii) presence of structural breaks in the dependent variables, and (iii) presence of heterogeneous institutional setting (country-specific health systems). Our results show that income elasticity is quite sensitive to the inclusion of technology variables and to health system heterogeneity, complementary and substitution relationships play an important role in determining public and private health care expenditure and, finally, public and private health care expenditures are both related with a cyclical indicator of the economic activity.

Keywords: health care expenditure, income elasticity, panel data, hypothesis testing, OECD

JEL Classification: C12, C21, C23, I10, I18

Suggested Citation

Atella, Vincenzo and Marini, Giorgia, Is Health Care Expenditure Really a Luxury Good? Re-Assessment and New Evidence Based on OECD Data (November 2006). Available at SSRN: https://ssrn.com/abstract=383004 or http://dx.doi.org/10.2139/ssrn.383004

Vincenzo Atella (Contact Author)

University of Rome Tor Vergata - Centre for International Studies on Economic Growth (CEIS) ( email )

Via Columbia, 2
Rome, I-00133
Italy
+39 06 72595648 (Phone)

Department of Economics and Finance ( email )

Via Columbia 2
Roma, 00133
Italy

University of Rome Tor Vergata - Faculty of Economics ( email )

Via Columbia n.2
I-00133 Rome, 00133
Italy
+39 06 72595635 (Phone)
+30 06 2020 500 (Fax)

HOME PAGE: http://www.economia.uniroma2.it/sefemeq/professori/atella/

Giorgia Marini

University of Rome La Sapienza ( email )

Piazzale Aldo Moro 5
Roma, Rome 00185
Italy

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