IDEAS home Printed from https://ideas.repec.org/p/yor/yorken/99-15.html
   My bibliography  Save this paper

Growth and Containment of Health Care Expenditure in Industrial Countries

Author

Listed:
  • Theo Hitiris

Abstract

Health Expenditure has been rising faster than the growth of income in most industrial countries. The objective of this paper is to discover what factors determined Health Expenditure per head of population in the G7 Countries and whether governments could control them. The analysis has identified three factors that affect Health Expenditure positively: income per head, the ageing population and the share of public expenditure on GDP. None of these variables can be controlled by the government for the sole purpose of containing the growth of Health Care Expenditure. Therefore, only reform of national Health Service Systems could effectively contain the growth of Health Spending. The reforms introduced by some countries in the early 1990s had no significant effect on cost containment with the result that health care expenditure continued to rise in some faster than before. The exception is Japan which managed to achieve a significant downturn in the growth of health expenditure.

Suggested Citation

  • Theo Hitiris, "undated". "Growth and Containment of Health Care Expenditure in Industrial Countries," Discussion Papers 99/15, Department of Economics, University of York.
    • Handle: RePEc:yor:yorken:99/15
    as

    Download full text from publisher

    File URL: https://www.york.ac.uk/media/economics/documents/discussionpapers/1999/9915.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. David M. Cutler & Ellen Meara, 1998. "The Medical Costs of the Young and Old: A Forty-Year Perspective," NBER Chapters, in: Frontiers in the Economics of Aging, pages 215-246, National Bureau of Economic Research, Inc.
    2. Pauly, Mark V, 1986. "Taxation, Health Insurance, and Market Failure in the Medical Economy," Journal of Economic Literature, American Economic Association, vol. 24(2), pages 629-675, June.
    3. Frank T. Denton & Byron G. Spencer, 1975. "Health-Care Costs When the Population Changes," Canadian Journal of Economics, Canadian Economics Association, vol. 8(1), pages 34-48, February.
    4. Parkin, David & McGuire, Alistair & Yule, Brian, 1987. "Aggregate health care expenditures and national income : Is health care a luxury good?," Journal of Health Economics, Elsevier, vol. 6(2), pages 109-127, June.
    5. Joseph P. Newhouse, 1977. "Medical-Care Expenditure: A Cross-National Survey," Journal of Human Resources, University of Wisconsin Press, vol. 12(1), pages 115-125.
    6. Cutler, David M, 1995. "The Cost and Financing of Health Care," American Economic Review, American Economic Association, vol. 85(2), pages 32-37, May.
    7. Anderton, Bob & Pesaran, Bahram & Wren-Lewis, Simon, 1992. "Imports, Output and the Demand for Manufactures," Oxford Economic Papers, Oxford University Press, vol. 44(2), pages 175-186, April.
    8. Gerdtham, Ulf-G. & Sogaard, Jes & Andersson, Fredrik & Jonsson, Bengt, 1992. "An econometric analysis of health care expenditure: A cross-section study of the OECD countries," Journal of Health Economics, Elsevier, vol. 11(1), pages 63-84, May.
    9. Joseph P. Newhouse, 1992. "Medical Care Costs: How Much Welfare Loss?," Journal of Economic Perspectives, American Economic Association, vol. 6(3), pages 3-21, Summer.
    10. Blomqvist, A. G. & Carter, R. A. L., 1997. "Is health care really a luxury?," Journal of Health Economics, Elsevier, vol. 16(2), pages 207-229, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Guisan, M.C. & Aguayo, E., 2007. "Health Expenditure, Poverty and Economic Development in Latin America 2000-2005," International Journal of Applied Econometrics and Quantitative Studies, Euro-American Association of Economic Development, vol. 4(2), pages 5-24.
    2. Julian Ramajo & Javier Salinas & Francisco Pedraja & Miguel Márquez, 2007. "Competition in the allocation of public spending: a new model to analyse the interaction between expenditure categories," Economics Bulletin, AccessEcon, vol. 8(4), pages 1-7.
    3. Rihem Zeiri & Aida Bouzir & Mohamed H di Benhadj Mbarek & Saloua Benammou, 2023. "The Link between Economic Growth, Air Pollution and Health Expenditure in the G7 Countries," International Journal of Energy Economics and Policy, Econjournals, vol. 13(4), pages 156-168, July.
    4. repec:ebl:ecbull:v:8:y:2007:i:4:p:1-7 is not listed on IDEAS
    5. Ismael Sanz & Francisco Javier Velázquez, 2002. "Determinants of the Composition of Government Expenditure by Functions," European Economy Group Working Papers 13, European Economy Group.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Margherita Giannoni & Theodore Hitiris, 2002. "The regional impact of health care expenditure: the case of Italy," Applied Economics, Taylor & Francis Journals, vol. 34(14), pages 1829-1836.
    2. Di Matteo, Livio, 2005. "The macro determinants of health expenditure in the United States and Canada: assessing the impact of income, age distribution and time," Health Policy, Elsevier, vol. 71(1), pages 23-42, January.
    3. Joan Costa‐Font & Marin Gemmill & Gloria Rubert, 2011. "Biases in the healthcare luxury good hypothesis?: a meta‐regression analysis," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 174(1), pages 95-107, January.
    4. Chakroun, Mohamed, 2009. "Health care expenditure and GDP: An international panel smooth transition approach," MPRA Paper 14322, University Library of Munich, Germany.
    5. Di Matteo, Livio & Cantarero-Prieto, David, 2018. "The Determinants of Public Health Expenditures: Comparing Canada and Spain," MPRA Paper 87800, University Library of Munich, Germany.
    6. Mocan, H. Naci & Tekin, Erdal & Zax, Jeffrey S., 2004. "The Demand for Medical Care in Urban China," World Development, Elsevier, vol. 32(2), pages 289-304, February.
    7. Ben Brewer & Karen Smith Conway & Deniz Ozabaci & Robert S. Woodward, 2022. "US Health Care Expenditures, GDP and Health Policy Reforms: Evidence from End-of-Sample Structural Break Tests," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 48(4), pages 451-487, October.
    8. Muhammad Arshad Khan & Muhammad Iftikhar Ul Husnain, 2019. "Is health care a luxury or necessity good? Evidence from Asian countries," International Journal of Health Economics and Management, Springer, vol. 19(2), pages 213-233, June.
    9. Marwa Farag & A. NandaKumar & Stanley Wallack & Dominic Hodgkin & Gary Gaumer & Can Erbil, 2012. "The income elasticity of health care spending in developing and developed countries," International Journal of Health Economics and Management, Springer, vol. 12(2), pages 145-162, June.
    10. Slade, Eric P. & Anderson, Gerard F., 2001. "The relationship between per capita income and diffusion of medical technologies," Health Policy, Elsevier, vol. 58(1), pages 1-14, October.
    11. Fabio Pammolli & Francesco Porcelli & Francesco Vidoli & Monica Auteri & Guido Borà, 2017. "La spesa sanitaria delle Regioni in Italia - Saniregio2017," Working Papers CERM 01-2017, Competitività, Regole, Mercati (CERM).
    12. Tamara Fioroni, 2010. "Optimal savings and health spending over the life cycle," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 11(4), pages 355-365, August.
    13. Helmut Herwartz & Bernd Theilen, 2003. "The determinants of health care expenditure: testing pooling restrictions in small samples," Health Economics, John Wiley & Sons, Ltd., vol. 12(2), pages 113-124, February.
    14. Badi H. Baltagi & Raffaele Lagravinese & Francesco Moscone & Elisa Tosetti, 2017. "Health Care Expenditure and Income: A Global Perspective," Health Economics, John Wiley & Sons, Ltd., vol. 26(7), pages 863-874, July.
    15. Felipa de Mello-Sampayo & Sofia de Sousa-Vale, 2014. "Financing Health Care Expenditure in the OECD Countries: Evidence from a Heterogeneous, Cross-Sectional Dependent Panel," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 61(2), pages 207-225.
    16. Isabel Casas & Jiti Gao & Bin Peng & Shangyu Xie, 2021. "Time‐varying income elasticities of healthcare expenditure for the OECD and Eurozone," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 36(3), pages 328-345, April.
    17. Lacheheb, Miloud & Med Nor, Norashidah & Baloch, Imdadullah, 2014. "Health Expenditure, education and Economic Growth in MENA Countries," MPRA Paper 60388, University Library of Munich, Germany.
    18. James Ang, 2010. "The determinants of health care expenditure in Australia," Applied Economics Letters, Taylor & Francis Journals, vol. 17(7), pages 639-644.
    19. Carla Blazquez-Fernandez & David Cantarero & Patricio Perez, 2014. "Disentangling the heterogeneous income elasticity and dynamics of health expenditure," Applied Economics, Taylor & Francis Journals, vol. 46(16), pages 1839-1854, June.
    20. Faisal Abbas & Ulrich Hiemenz, 2013. "What determines public health expenditures in Pakistan? Role of income, urbanization and unemployment," Economic Change and Restructuring, Springer, vol. 46(4), pages 341-362, November.

    More about this item

    Keywords

    Health care expenditure; cost containment;

    JEL classification:

    • I10 - Health, Education, and Welfare - - Health - - - General
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:yor:yorken:99/15. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Paul Hodgson (email available below). General contact details of provider: https://edirc.repec.org/data/deyoruk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.