Is Health Care Expenditure Really a Luxury Good? Re-Assessment and New Evidence Based on OECD Data
24 Pages Posted: 13 Feb 2013
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: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
Health Care Expenditures in OECD Countries: A Panel Unit Root and Cointegration Analysis
-
Decomposing the Determinants of Health Care Expenditure: The Case of Spain
-
What Determines Macroeconomic Volatility? A Cross-Section and Panel Data Study
-
Health Care Expenditure and GDP: An International Panel Smooth Transition Approach
-
The Volatility Trap: Precautionary Saving, Investment, and Aggregate Risk
By Reda Cherif and Fuad Hasanov