Does Education Mitigate the Effect of Population Aging on Health Expenditure? A Panel Data Study of Latin American Countries

Abstract

Objective: To examine whether the effect of population aging on healthcare expenditures as a share of Gross Domestic Product (GDP) is attenuated in more educated countries. Method: The analysis is based on a dataset of 22 Latin American countries between 1995 and 2013. We estimate panel data models with country and time fixed effects, and control for potential nonlinear effects of population aging on health expenditure. Results: We find population aging increases health expenditure as a share of GDP in economies characterized by low levels of education, but this effect is mitigated in economies with higher levels of education. Results are driven by private health expenditures. Discussion: Results suggest population aging and education have a stronger influence on healthcare expenditures in less developed countries. This finding is important in a context in which the rapid growth of the aging population is likely to lead to significant costs in terms of health expenditures, but less so in more educated societies.

Spatio-temporal Analysis of Demand for Elderly Care Services and Its Key Influencing Factors in Chinese Cities: A Web Search Engine Approach

“… 59 And people with lower education attainment may have lower health literacy, which left them with some unrecognized or undiscovered elderly care demand. 60 In addition, studies pointed out that educational attainment played a role in factors affecting the daily life of older people and was associated with psychosocial and biological conditions. 61 , 62 For the family, studies showed a positive association between children’s educational attainment and parents’ cognitive health, 63 and the higher education attainment of the whole family, the more attention the residents attach to their own and their relatives’ old-age life, which also had a positive impact on the demand.…”

Inhibiting or promoting: Population aging and economic development in China

“…In addition to focusing on the characteristics of the elderly who have relatively more savings, the educational and academic background of the elderly is also worth analyzing. Individuals with strong academic backgrounds or high levels of education who are newly entering old age can positively influence the development of the regional economy [ 28 ] and can partially mitigate the negative effects of the overall elderly population [ 1 ]. In addition to the above factors, Khan Mamun [ 29 ] and Galappaththi Kethaka [ 30 ] have proved that there is a positive correlation between population aging and economic growth.…”

Exploring the Dynamic Nexus Among Economic Growth, Industrialization, Medical Technology, and Healthcare Expenditure: A PMG-ARDL Panel Data Analysis on Income-Level Classification Along West African Economies

“…Furthermore, Lopreite and Zhu (27) discovered that an aged population has a sturdy effect on healthcare spending. According to Borrescio-Higa and Valenzuela (28), countries with low literacy levels are more likely to face a consistent increase in healthcare spending than countries with higher literacy rates. Other researchers like Costa-Font and Vilaplana-Prieto (29) affirmed that healthcare spending is not dependent on the aged population.…”