What drives the healthcare sector's economic impact? Evidence from European countries

Abstract

PurposeWith high public debts and suffering economies after the COVID-19 pandemic, governments will look for ways to promote recovery. Literature substantially reports on the favorable macroeconomic impact of the healthcare sector.Design/methodology/approachThe authors use data on 19 European countries. Over 30 variables are analyzed to find factors that foster or suppress the economic impact of the healthcare sector. The economic impact is thereby expressed through five types of total multipliers, acting as dependent variables. The authors estimate multiple econometric models.FindingsThe results indicate factors that intensify or reduce the economic impact of the healthcare sector as they cause the value of one or more economic multipliers to augment or to diminish. Positive effects are expected from the growth of public funds' share in total healthcare expenditure leading to a higher output, income and value-added multipliers. The import multiplier diminishes when expenditure on healthcare as percent of GDP rises. On the other hand, rising expenditure on pharmaceuticals in the share of healthcare expenditure lowers the output multiplier. Rising GDP per capita and higher healthcare systems' technical efficiency cause the employment multiplier to lower.Originality/valuePolicymakers can strengthen the economic impact of the healthcare sector on the national economy. This could be achieved by stimulating factors, being identified in our study. Strengthening the economic impact of the healthcare sector is especially welcomed when fostering economic recovery is needed.

Mediating effect of integrated health commodities procurement system on the relationship between responsiveness and health service delivery

“…Literature claims that health facilities face several challenges which impede efficiency and effective delivery of health services. Among others, the challenges include but are not limited to frequent stock out of health commodities, lack of responsiveness among service providers, delays in delivery of health commodities and relatively high prices of health services (Jagric et al , 2022; Chukwu et al , 2018; Mirzoev and Kane, 2017; Nuhu et al , 2020; Akhtar and Saikia, 2022). In order to minimise these deficiencies, public health facilities have been mandated to integrate and centralise the procurement and distribution of health commodities through e-procurement system (URT, 2013).…”

Financial ratios and institutional ownership impact on healthcare firm’s value: A moderation role of leverage

“…Despite the precarious economic conditions brought on by this epidemic, the health business is nevertheless growing, as indicated by the increase in the Gross Domestic Product (GDP) of the health sector, which was 8.69 % in , 11.56% in 2020, and 10.61% in 2021(Central Bureau of Statistics Indonesia, 2022. The value of firms in the healthcare sector should increase due to this robust growth in health sector GDP (Jagric et al, 2022;Sartika et al, 2019). However, the above sectoral growth data does not reflect the market capitalization data for the health services business.…”

IJHG review 27.1

“…Although these two articles focus on specific countries (India and Iran) lessons learned are more widely applicable. Jagric et al (2022) expand on the issues of hospital finance from a European perspective and examine the effect of healthcare spending on national budgets. Thompson et al (2022) highlight the growing problem of the frail elderly population in the UK and examine evidence for frailty care pathways.…”

“…Although there are national differences, both philosophically and economically, a consistent theme is that, regardless of political ideology, governments strive to increase quality while reducing expenditure. Jagric et al (2022) examined the impact of the health sector on national economies across Europe, with the aim of identifying factors, which either increase or suppress the economic impact of the healthcare sector.…”