Is social protection a necessity or a luxury good? New multivariate cointegration panel data results

Abstract

The aim of this paper is to test the claim that social protection is a luxury good. Therefore, GDP elasticity of selected social protection expenditure is estimated using a new econometric approach developed first by Kao and Chiang (Advances in Econometrics, 15, 179-222, 2000). Time series properties of selected social expenditure in 18 OECD countries from 1981 to 1998 are examined. Using panel data cointegration tests and OLS, FMOLS and DOLS estimators, results were found which differ from previous analyses reporting substantially higher income elasticities. With the FMOLS, selected social expenditure has income elasticities smaller than one but greater than one with the DOLS. It is noteworthy that whether selected social expenditure is stationary or nonstationary may have critical implications for researchers and policy makers desiring to model and explain the impact of this expenditure on a country economic system

Alternative estimators of cointegrating parameters in models with nonstationary data: an application to US export demand

“…Examples of its use can be found in Masih and Masih (1996), Agarwal (2001), Konno and Fukushige (2003), Narayan (2004) and Narayan and Narayan (2005). Recently it has also been used extensively in the estimation of equilibrium parameters in dynamic panel models as in Auteri and Constantini (2004) and Harb (2005Harb ( , 2007.…”

Determinants of Household Health Expenditure in Poland

“…Przytoczone wyżej wyniki badań, w których wartość elastyczności wydatków na zdrowie względem dochodów okazała się niższa od jedności nie pozwalają przy tym na wyciągnięcie jednoznacznego wniosku o nieelastyczności dochodowej opieki zdrowotnej. W wielu badaniach wartość tej elastyczności okazała się większa od jednego, co wskazuje na luksusowy charakter opieki zdrowotnej; przykładami są analizy dotyczące Australii [Ang, 2010: 639-644], 18 krajów OECD [Auteri, Costantini, 2004: 1887-1898, 22 krajów OECD [Liu i in., 2010: 95-118], Turcji [Kiymaz i in. 2006], 138 krajów [Murray i in., 1994: 623-637] czy regionów amerykańskich [Murthy, Okunade, 2000].…”

Alternative Estimators of Cointegrating Parameters in Models With Non-Stationary Data: An Application to US Export Demand

“…Examples of its use can be found in Masih and Masih (1996), Agarwal (2001), Konno and Fukushige (2003), Narayan (2004) and Narayan and Narayan (2005). Recently it has also been used extensively in the estimation of equilibrium parameters in dynamic panel models as in Auteri and Constantini (2004) and Harb (2005 and2007).…”