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Do health expenditures 'catch-up'? Evidence from OECD countries

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  • Paresh Kumar Narayan

    (Department of Accounting, Finance and Economics, Griffith Business School, Queensland, Australia)

Abstract

In this paper, we examine the 'catch-up' hypothesis, that is, whether or not per capita health expenditures of the UK, Canada, Japan, Switzerland, and Spain converge to the per capita health expenditures of the USA over the period 1960-2000. We propose a framework to examine convergence of health expenditures and use recent developments in unit root testing, namely the Lagrange multiplier univariate and panel approaches that allow for at most two structural breaks. Our main finding is that while univariate and panel tests that do not incorporate structural breaks fail to find evidence of convergence, univariate and panel LM tests that allow for structural breaks find strong evidence of convergence of per capita health expenditures of the UK, Canada, Japan, Switzerland, and Spain to that of the USA. Copyright © 2007 John Wiley & Sons, Ltd.

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Bibliographic Info

Article provided by John Wiley & Sons, Ltd. in its journal Health Economics.

Volume (Year): 16 (2007)
Issue (Month): 10 ()
Pages: 993-1008

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Handle: RePEc:wly:hlthec:v:16:y:2007:i:10:p:993-1008

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

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Cited by:
  1. Aslan, Alper, 2008. "Türkiye’de Suç Oranları Sürekliliğinin Analizi," MPRA Paper 10610, University Library of Munich, Germany.
  2. Andrea Leiter & Engelbert Theurl, 2009. "The Convergence of Health Care Financing Structures: Empirical Evidence from OECD-Countries," NRN working papers, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria 2009-12, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria.
  3. Fallahi, Firouz, 2011. "Convergence of Total Health Expenditure as a Share of GDP: Evidence from Selected OECD Countries," MPRA Paper 51324, University Library of Munich, Germany.
  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., John Wiley & Sons, Ltd., vol. 17(10), pages 1171-1186.
  5. Aslan, Alper, 2008. "Convergence of per capita health care expenditures in OECD Countries," MPRA Paper 10592, University Library of Munich, Germany.

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