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The fiscal impact of health care expenditure: Evidence from the OECD countries

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  • Christopoulos, Konstantinos
  • Eleftheriou, Konstantinos

Abstract

Health care expenditures are expected to challenge the fiscal sustainability even more in the coming years. The purpose of this study is to examine the relationship and spillover effects between the health care expenditure and health outcome measured by the potential years of life lost as well as the marginal impact of the former on public accounts. Using data from 29 OECD countries over the period 1990–2017, we apply spatial econometrics as well as a fiscal analytic framework in order to calculate the fiscal impact of health care expenditure. We find a positive relationship between health care expenditures and health outcome which is translated fiscally into $0.035 per capita net revenue for every per capita dollar spent on health care.

Suggested Citation

  • Christopoulos, Konstantinos & Eleftheriou, Konstantinos, 2020. "The fiscal impact of health care expenditure: Evidence from the OECD countries," Economic Analysis and Policy, Elsevier, vol. 67(C), pages 195-202.
    • Handle: RePEc:eee:ecanpo:v:67:y:2020:i:c:p:195-202
    DOI: 10.1016/j.eap.2020.07.010
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    2. Ledesma-Cuenca, Ana & Montañés, Antonio & Simón-Fernández, María Blanca, 2022. "Disparities in premature mortality: Evidence for the OECD countries," Social Science & Medicine, Elsevier, vol. 307(C).
    3. Bancalari, Antonella & Bernal, Pedro & Celhay, Pablo & Martinez, Sebastian & Sánchez, Maria Deni, 2023. "An Ounce of Prevention for a Pound of Cure: Efficiency of Community-Based Healthcare," IZA Discussion Papers 16350, Institute of Labor Economics (IZA).
    4. Bancalari, Antonella & Bernal, Pedro & Celhay, Pablo & Martinez, Sebastian & Sánchez, María Deni, 2024. "An Ounce of Prevention for a Pound of Cure: Basic Health Care and Efficiency in Health Systems," IDB Publications (Working Papers) 13433, Inter-American Development Bank.

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    More about this item

    Keywords

    Fiscal; Health care expenditure; Health policy; Spatial;
    All these keywords.

    JEL classification:

    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models

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