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Regional inequality in China's health care expenditures

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  • Win Lin Chou
  • Zijun Wang

Abstract

This paper has two parts. The first part examines the regional health expenditure inequality in China by testing two hypotheses on health expenditure convergence. Cross‐section regressions and cluster analysis are used to study the health expenditure convergence and to identify convergence clusters. We find no single nationwide convergence, only convergence by cluster. In the second part of the paper, we investigate the long‐run relationship between health expenditure inequality, income inequality, and provincial government budget deficits (BD) by using new panel cointegration tests with health expenditure data in China's urban and rural areas. We find that the income inequality and real provincial government BD are useful in explaining the disparity in health expenditure prevailing between urban and rural areas. In order to reduce health‐spending inequality, one long‐run policy suggestion from our findings is for the government to implement more rapid economic development and stronger financing schemes in poorer rural areas. Copyright © 2009 John Wiley & Sons, Ltd.

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  • Win Lin Chou & Zijun Wang, 2009. "Regional inequality in China's health care expenditures," Health Economics, John Wiley & Sons, Ltd., vol. 18(S2), pages 137-146, July.
    • Handle: RePEc:wly:hlthec:v:18:y:2009:i:s2:p:s137-s146
    DOI: 10.1002/hec.1511
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    References listed on IDEAS

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    1. Winnie Yip & Adam Wagstaff & William C. Hsiao, 2009. "Economic analysis of China's health care system: turning a new page," Health Economics, John Wiley & Sons, Ltd., vol. 18(S2), pages 3-6, July.
    2. Halvor Mehlum & Ragnar Torvik & Simone Valente, 2013. "China s Savings Multiplier," Working Papers No 4/2013, Centre for Applied Macro- and Petroleum economics (CAMP), BI Norwegian Business School.
    3. Wen-Yi CHEN & Yu-Hui LIN, 2016. "Co-Movement of Healthcare Financing in OECD Countries: Evidence from Discrete Wavelet Analyses," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(3), pages 40-56, September.
    4. Qin, Xuezheng & Hsieh, Chee-Ruey, 2014. "Economic growth and the geographic maldistribution of health care resources: Evidence from China, 1949-2010," China Economic Review, Elsevier, vol. 31(C), pages 228-246.
    5. Luigi Bonatti & Andrea Fracasso, 2016. "Modelling The Transition Towards The Renminbi'S Full Convertibility: Implications For China'S Growth," Bulletin of Economic Research, Wiley Blackwell, vol. 68(S1), pages 146-170, December.
    6. Wen-Yi Chen, 2013. "Does healthcare financing converge? Evidence from eight OECD countries," International Journal of Health Economics and Management, Springer, vol. 13(3), pages 279-300, December.
    7. Masayoshi Hayashi, 2011. "The effects of medical factors on transfer deficits in Public Assistance in Japan: a quantile regression analysis," International Journal of Health Economics and Management, Springer, vol. 11(4), pages 287-307, December.
    8. Youhong Lin & Feng Liu & Peng Xu, 2021. "Effects of drought on infant mortality in China," Health Economics, John Wiley & Sons, Ltd., vol. 30(2), pages 248-269, February.
    9. Yip, Winnie & Hsiao, William, 2009. "China's health care reform: A tentative assessment," China Economic Review, Elsevier, vol. 20(4), pages 613-619, December.
    10. Chen, Yuyu & Jin, Ginger Zhe, 2012. "Does health insurance coverage lead to better health and educational outcomes? Evidence from rural China," Journal of Health Economics, Elsevier, vol. 31(1), pages 1-14.
    11. Shen, Yuying, 2014. "Community building and mental health in mid-life and older life: Evidence from China," Social Science & Medicine, Elsevier, vol. 107(C), pages 209-216.
    12. JunQiang Liu & Tao Chen, 2013. "Sleeping money: investigating the huge surpluses of social health insurance in China," International Journal of Health Economics and Management, Springer, vol. 13(3), pages 319-331, December.
    13. Yingru Li, 2012. "The spatial variation of China's regional inequality in human development," Regional Science Policy & Practice, Wiley Blackwell, vol. 4(3), pages 263-278, August.
    14. Vasudeva N. R. Murthy & Albert A. Okunade, 2014. "Population health status and economic growth in Chinese provinces: some policy implications," Applied Economics Letters, Taylor & Francis Journals, vol. 21(6), pages 377-382, April.
    15. Jiaoling Huang & Li Yuan & Hong Liang, 2020. "Which Matters for Medical Utilization Equity under Universal Coverage: Insurance System, Region or SES," IJERPH, MDPI, vol. 17(11), pages 1-17, June.
    16. Ambar, Rabnawaz, 2015. "Corruption, Inequality and Economic Growth," MPRA Paper 70375, University Library of Munich, Germany, revised 2015.

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