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Unit root properties of OECD health care expenditure and GDP data

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Author Info
Garry MacDonald (Department of Economics, Curtin University of Technology, Perth, Western Australia, Australia)
Sandra Hopkins (Department of Economics, Curtin University of Technology, Perth, Western Australia, Australia)

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Abstract

This note reconsiders the unit root properties of health care expenditure (HCE) and gross domestic product (GDP) for OECD countries. The time-series properties of this data set has been much discussed in the literature with contrasting results from the application of a range of test procedures. We use a recently developed test to examine the relationship between the two variables. The results in this paper confirm earlier findings that when the data are considered as a panel, there is strong evidence of unit roots in both GDP and HCE data. Copyright © 2001 John Wiley & Sons, Ltd.

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File URL: http://hdl.handle.net/10.1002/hec.657
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Publisher Info
Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 11 (2002)
Issue (Month): 4 ()
Pages: 371-376
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Handle: RePEc:wly:hlthec:v:11:y:2002:i:4:p:371-376

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Web page: http://www3.interscience.wiley.com/cgi-bin/jhome/5749

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Cheung, Yin-Wong & Lai, Kon S, 1995. "Lag Order and Critical Values of the Augmented Dickey-Fuller Test," Journal of Business & Economic Statistics, American Statistical Association, vol. 13(3), pages 277-80, July.
  2. McCoskey, Suzanne K. & Selden, Thomas M., 1998. "Health care expenditures and GDP: panel data unit root test results," Journal of Health Economics, Elsevier, vol. 17(3), pages 369-376, June. [Downloadable!] (restricted)
  3. Kwiatkowski, Denis & Phillips, Peter C. B. & Schmidt, Peter & Shin, Yongcheol, 1992. "Testing the null hypothesis of stationarity against the alternative of a unit root : How sure are we that economic time series have a unit root?," Journal of Econometrics, Elsevier, vol. 54(1-3), pages 159-178. [Downloadable!] (restricted)
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  4. Gerdtham, Ulf-G. & Lothgren, Mickael, 2000. "On stationarity and cointegration of international health expenditure and GDP," Journal of Health Economics, Elsevier, vol. 19(4), pages 461-475, July. [Downloadable!] (restricted)
  5. Gerdtham, Ulf-G. & Sogaard, Jes & Andersson, Fredrik & Jonsson, Bengt, 1992. "An econometric analysis of health care expenditure: A cross-section study of the OECD countries," Journal of Health Economics, Elsevier, vol. 11(1), pages 63-84, May. [Downloadable!] (restricted)
  6. Maddala, G S & Wu, Shaowen, 1999. " A Comparative Study of Unit Root Tests with Panel Data and a New Simple Test," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(0), pages 631-52, Special I. [Downloadable!] (restricted)
  7. Hansen, Paul & King, Alan, 1996. "The determinants of health care expenditure: A cointegration approach," Journal of Health Economics, Elsevier, vol. 15(1), pages 127-137, February. [Downloadable!] (restricted)
  8. Blomqvist, A. G. & Carter, R. A. L., 1997. "Is health care really a luxury?," Journal of Health Economics, Elsevier, vol. 16(2), pages 207-229, April. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Andrea M. Leiter & Engelbert Theurl, 2009. "The Convergence of Health Care Financing Structures: Empirical Evidence from OECD-Countries," Working Papers 2009-20, Faculty of Economics and Statistics, University of Innsbruck. [Downloadable!]
  2. Anurag Sharma & Preety Ramful, 2008. "Does disaggregation affect the relationship between health care expenditure and GDP? An analysis using regime shifts," Centre for Health Economics Research Papers 27/08, Monash University, Centre for Health Economics. [Downloadable!]
  3. Richard Miller & Ted Frech, 2002. "The Productivity of Health Care and Pharmaceuticals: Quality of Life, Cause," University of California at Santa Barbara, Economics Working Paper Series 12-02, Department of Economics, UC Santa Barbara. [Downloadable!]
  4. Paresh Kumar Narayan & Seema Narayan, 2008. "The role of permanent and transitory shocks in explaining international health expenditures," Health Economics, John Wiley & Sons, Ltd., vol. 17(10), pages 1171-1186. [Downloadable!]
  5. Santerre, Rexford E, 2009. "The new drug offset effect: some national and international evidence," MPRA Paper 13628, University Library of Munich, Germany. [Downloadable!]
  6. Zijun Wang & Andrew J. Rettenmaier, 2007. "A note on cointegration of health expenditures and income," Health Economics, John Wiley & Sons, Ltd., vol. 16(6), pages 559-578. [Downloadable!]
  7. Andrea Leiter & Engelbert Theurl, 2009. "The Convergence of Health Care Financing Structures: Empirical Evidence from OECD-Countries," NRN working papers 2009-12, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria. [Downloadable!]
  8. Mohan, Ramesh & Mirmirani, Sam, 2007. "An Assessment of OECD Health Care System Using Panel Data Analysis," MPRA Paper 6122, University Library of Munich, Germany. [Downloadable!]
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