Health Expenditures And Life Expectancy Around The World: A Quantile Regression Approach
AbstractPrevious literature has produced mixed results on the effects of country health expenditures on longevity. More importantly, all previous studies have evaluated the expenditure effects on the mean of the life expectancy distribution, ignoring the possibility that the expenditure returns may not be the same for countries that differ in their life expectancies. In this paper, we evaluate the heterogeneity in country health expenditure effects throughout the life expectancy distribution applying quantile regression to an assembled dataset of 177 countries. We find significant heterogeneities in expenditures effects on life expectancy that are completely masked by ordinary least squares (OLS), which underestimates (overestimates) the expenditure returns for countries ranking at low (high) life-expectancy quantiles. The largest returns from increased spending are for countries at the left margin of the life expectancy distribution (mainly at quantiles 0.25 and lower), for which a $100 increase in per capita spending leads to 11.5 and 11 months of life for males and females, respectively. The results suggest that increasing healthcare spending in these countries may have significant population-wide life expectancy returns.
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Bibliographic InfoPaper provided by Kyiv School of Economics in its series Discussion Papers with number 47.
Date of creation: Jan 2012
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Health Expenditures; Life Expectancy; Quantile Regression;
Find related papers by JEL classification:
- I1 - Health, Education, and Welfare - - Health
- C2 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables
This paper has been announced in the following NEP Reports:
- NEP-AGE-2012-01-18 (Economics of Ageing)
- NEP-ALL-2012-01-18 (All new papers)
- NEP-HEA-2012-01-18 (Health Economics)
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