A Dynamic Relationship between Environmental Degradation, Healthcare Expenditure and Economic Growth in Wavelet Analysis: Empirical Evidence from Taiwan

Abstract

This paper analyzes the co-movement and causal linkages between environmental pollution and healthcare expenditure, taking economic growth as a control variable by using wavelet analysis for Taiwan over the period 1995 Q1–2016 Q4. The results show that there exists co-movement and causality between environmental pollution and healthcare expenditure at different frequencies and times. The changes in the relationships of the two variables are observed in certain events such as the period of the expansion stage, the policy of environmental pollution, and the issue of the National Health Insurance Integrated Circuit card (NHI-IC) in Taiwan. In the short-term, positive causality runs from healthcare expenditure to environmental pollution before 2004, while negative causality runs from healthcare expenditure to environmental pollution before 2007 in the long-term. After adding economic growth as a control variable, positive causality runs from healthcare expenditure to environmental pollution in the period 2009–2011 in the short-term, while negative causality running from healthcare expenditure to environmental pollution is shown in 2008 in the long-term. The results indicate that “higher government health expenditure leading to higher demand for environment quality” exists in different sub-periods and the argument may concern the factor of economics in the long-term. The positive healthcare lead in the short-term may be based on economics in the expansion stage. Also, the issue of NHI-IC possibly affects the dynamic relationship between healthcare expenditure and environmental pollution without considering economics. Based on empirical analysis, certain policy and managerial implications are addressed for decision-makers at macroeconomic and microeconomic levels.

Association between health expenditures, economic growth and environmental pollution: Long‐run and causality analysis from Asian economies

“…The reasons for using CO 2 are that (i) it considers to be a more valid and reliable proxy to measure environmental pollution 61 and used by many researchers; 53 Usman et al. 201; 4,21 and other) (ii) its particles remain longer time in atmosphere; 53 (iii) Its percentage is highest among the accumulation of GHGs; 62 (iv) It has high degree of correlation with other pollutants 63 . EG, THEs, PBHEs and PRHEs are measured by GDP per capita (Purchasing Power Parity (PPP), constant US$); THEs per capita (PPP, current US$); PBHEs per capita (PPP, current US$) and PRHEs per capita (PPP, current US$) respectively.…”

“…Causality results indicate that GHS lead to Public and private financing on health in sample panel. In a recent study, Wu et al 21 demonstrated correlation and causality between carbon emissions and health financing in Taiwan at different time and scale. The upward trend in health financing in short-term is based on expansion in economic output.…”

“…In this study, CO 2 emissions per capita (metric tons) is used to measure environmental pollution (EP). The reasons for using CO 2 are that (i) it considers to be a more valid and reliable proxy to measure environmental pollution 61 and used by many researchers; 53 Usman et al 201;4,21 and other) (ii) its particles remain longer time in atmosphere; 53 (iii) Its percentage is highest among the accumulation of GHGs; 62 (iv) It has high degree of correlation with other pollutants. 63 A1 and A2.…”

“…The pairwise association between income growth and environmental pollution; income growth and health expenditures; environmental pollution and health expenditures is extensively studied in empirical literature (see for example 6,[12][13][14][15][16][17][18] However, a relatively few studies examined the link between health expenditures, income growth and environmental quality by utilizing time-series [19][20][21] and panel data techniques. 3,18,22 Therefore, the objective of current study is to empirically examine the association between health expenditures, EG and environmental pollution in Asian countries both at aggregated and individual level.…”

The Complexity of Space Utilization and Environmental Pollution Control in the Main Corridor of Makassar City, South Sulawesi, Indonesia

“…Since activities have a different location, their separation is a generator of movements of passengers and freight, which are supported by transportation. Therefore, transportation and land use are interrelated because of the locational and interactional nature of urban activities [53].…”