Health care expenditures in industrial countries have been growing rapidly over the past forty years. This rapid growth jeopardizes the sustainability of public budgets and causes an increasing interest in the determinants of health care expenditures. The first purpose of this paper is to give an up to date overview of the literature on health care expenditures. Secondly, this paper tries to contribute to the existing literature by investigating the impact of several factors on health care expenditures in an empirical analysis using an error-correction model. Additional to the ‘usual suspects’ for rising health care expenditures, we pay attention to a somewhat neglected driving factor, which is the increase in the relative price of health care compared to other goods and services. We find that the increasing price of health care helps to explain the increase in real health care expenditures. However, the use of health care in volume terms is negatively affected by the increasing price. This effect seems to be stronger in periods of cost containment policy. Consistent with most recent findings in the literature, we find that income and ageing are important drivers of health care expenditures.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
Publisher Info
Paper provided by CPB Netherlands Bureau for Economic Policy Analysis in its series CPB Discussion Papers with number
121.
Find related papers by JEL classification: I10 - Health, Education, and Welfare - - Health - - - General H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
This paper has been announced in the following NEP Reports:
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.: