Stationarity of health expenditures and GDP: evidence from panel unit root tests with heterogeneous structural breaks

Jewell, Todd; Lee, Junsoo; Tieslau, Margie; Strazicich, Mark C.

doi:10.1016/s0167-6296(02)00122-4

Cited by 129 publications

(98 citation statements)

References 23 publications

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“…However, the results reported in such studies may not be robust if the underlying data generating process (DGP) for the two series is characterised by structural changes (Freeman 2012). Therefore, some more recent papers allow for structural breaks when testing for cointegration (Jewel et al 2003;Narayan 2006;Wang and Rettenmaier 2007, among others). On the whole, the evidence is rather mixed.…”

Section: Literature Reviewmentioning

confidence: 99%

The relationship between healthcare expenditure and disposable personal income in the US states: a fractional integration and cointegration analysis

et al. 2017

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This study examines the relationship between healthcare expenditure and disposable income in the 50 US states over the period 1966-2009 using fractional integration and cointegration techniques. The degree of integration and nonlinearity of both series are found to vary considerably across states, while the fractional cointegration analysis suggests that a long-run relationship exists between them in only 11 out of the 50 US states. The estimated long-run income elasticity of healthcare expenditure suggests that health care is a luxury good in these states. By contrast, the short-run elasticity obtained from the regressions in first differences is in the range (0, 1) for most US states, which suggests that health care is a necessity good instead. The implications of these results for health policy are also discussed.

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Section: Literature Reviewmentioning

confidence: 99%

The relationship between healthcare expenditure and disposable personal income in the US states: a fractional integration and cointegration analysis

et al. 2017

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“…But also, which of both actually influences life expectancy? [33][34][35][36]. There is however consensus that when analyzing health status, both should be included to avoid that the effect of both factors are merged [37][38][39].…”

Section: Variables and Modelsmentioning

confidence: 99%

Productive Efficiency and Heterogeneity of Health Care Systems: Results of a Measurement for OECD Countries

Kotzian

2009

TOECONSJ

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Abstract: Health system efficiency is a major target of health policy but its conceptualization and measurement are still a problem in health economics. Because health status is influenced by many factors outside the health system, I argue that measurements of health system efficiency should focus on the process of turning financial input into additional health output rather than the levels of health status reached. When analyzing levels of health status using regression methods, the appropriate efficiency indicator is hence not a country-specific intercept based on the achieved health status, but a country-specific slope for input factors in the production function of health outcomes. The slopes represent health system efficiency, while the intercepts represent health relevant heterogeneity among countries. Using data on OECD members these slopes are estimated. Countries differ far more in their residual heterogeneity than in the rate by which their health system turns money into life years. Terms of use: Documents in

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“…Jewell et al (2003) control for contemporaneous correlation by introducing time-speci…c e¤ects in the econometric speci…cation. However, the inclusion of time-varying e¤ects implies that the common shocks have identical in ‡uences on each unit, an assumption that might be quite restrictive in empirical analysis.…”

Section: Cross Section Dependence In Health Expenditurementioning

confidence: 99%

“…On the contrary, McCoskey and Selden (1998) reject the null of non-stationarity for health care expenditures and GDP, though they observe that results change when a time trend is included in the augmented Dickey-Fuller equation. Jewell et al (2003) and Carrion-i-Silvestre (2005) conclude that health expenditure and GDP are stationary around one or two breaks. In general, major concern is expressed by several authors on how to deal with heterogeneity and cross section dependence, characteristics that are very likely to be present in health panel data, when testing for unit roots and cointegration (McCoskey and Selden, 1998; Roberts, 1999).…”

Section: Introductionmentioning

confidence: 99%

Health Expenditure and Income in the United States

Tosetti

Moscone

2007

SSRN Journal

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This paper investigates the long-run economic relationship between health care expenditure and income in the US at a State level. Using a panel of 49 US States followed over the period 1980-2004, we study the non-stationarity and cointegration between health spending and income, ultimately measuring income elasticity of health care. The tests we adopt allow us to explicitly control for cross-section dependence and unobserved heterogeneity. Speci…cally, in our regression equations we assume that the error is the sum of a multifactor structure and a spatial autoregressive process, which capture global shocks and local spill overs in health expenditure. Our results suggest that health care is a necessity rather than a luxury, with an elasticity much smaller than that estimated in other US studies. Further, we observe a signi…cant spatial spill over, though with a smaller intensity than that detected in other studies on spatial concentration of US health spending. Our broad perspective of cross section dependence as well as the methods used to capture it give new insights on the debate over the relationship between health spending and income.JEL Classi…cation: C31, C33, H51

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Stationarity of health expenditures and GDP: evidence from panel unit root tests with heterogeneous structural breaks

Cited by 129 publications

References 23 publications

The relationship between healthcare expenditure and disposable personal income in the US states: a fractional integration and cointegration analysis

The relationship between healthcare expenditure and disposable personal income in the US states: a fractional integration and cointegration analysis

Productive Efficiency and Heterogeneity of Health Care Systems: Results of a Measurement for OECD Countries

Health Expenditure and Income in the United States

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