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Health Care Expenditure And Gdp: An African Perspective

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Author Info
JAUNKY, V.C ()
KHADAROO, A.J. ()
Abstract

This paper sheds light on the income elasticity of health care expenditure in Africa. The existing literature has to date focused on developed countries due to scarcity of health expenditure data in developing countries. We herein exploit panel data techniques, combining time-series and cross-section data, which enable a substantial increase in testing power. Income elasticity of health care expenditure for 28 African countries over the decade 1991 – 2000 is investigated. In addition to aggregate health expenditure, we model public and private health expenditures separately. In both the short-run and long-run, public health expenditure is found to be a luxury while private health expenditure a necessity. This is not too surprising in the context of Africa, where the public sector has to strive hard to provide basic health care to the poor majority but where a rich minority can easily afford hi-tech private health care. Furthermore the income elasticity of public health expenditure is found to be pro-cyclical while that of private health expenditure is counter-cyclical, thereby reinforcing our previous finding.

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Article provided by Euro-American Association of Economic Development in its journal Applied Econometrics and International Development.

Volume (Year): 8 (2008)
Issue (Month): 1 ()
Pages: 131-146
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Handle: RePEc:eaa:aeinde:v:8:y:2008:i:1_11

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Related research
Keywords: Health care expenditure; panel cointegration; Africa;

Find related papers by JEL classification:
C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data
I10 - Health, Education, and Welfare - - Health - - - General

References listed on IDEAS
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  6. Karras, Georgios, 2003. "Trade Openness And Economic Growth Can We Estimate The Precise Effect?," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 3(1). [Downloadable!]
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  8. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages S71-102, October. [Downloadable!] (restricted)
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