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Exploring Differences in Expenditure for the Functionally Impaired: Neighborhood Interaction and the Federal Structure

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Author Info
Birkelöf, Lena () (Department of Economics, Umeå University)
Abstract

The purpose of this paper is to study the determinants of the differences in expenditure on services for functionally impaired individuals among municipalities in Sweden. Expenditure per capita differs greatly across municipalities, even when accounting for the nature of the service. A spatial autoregressive model is used to test whether the decisions on the expenditure level in a neighboring municipality affect the municipality’s own expenditure. The results show that a positive spatial interaction exists among neighbors. However, when controlling for level differences among counties the spatial interaction coefficient becomes negative although not significantly determined. Therefore, the positive interaction first found can be interpreted either as a result of differences in the way county councils diagnose individuals or due to interaction or mimicking among neighbors belonging to the same county council.

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File URL: http://www.econ.umu.se/ues/ues748.pdf
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Publisher Info
Paper provided by Umeå University, Department of Economics in its series Umeå Economic Studies with number 748.

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Length: 28 pages
Date of creation: 27 Jun 2008
Date of revision:
Handle: RePEc:hhs:umnees:0748

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Postal: Department of Economics, Umeå University, S-901 87 Umeå, Sweden
Phone: 090 - 786 61 42
Fax: 090 - 77 23 02
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Web page: http://www.econ.umu.se/
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Related research
Keywords: Local Public Expenditures; Spatial Econometrics; Functional Impairment;

Find related papers by JEL classification:
H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
R12 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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