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Convergence Analysis of Health Care Expenditure in the EU Countries Using Two Approaches

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  • John Nixon

Abstract

Convergence analysis in economics has largely been confined to macro-indicators such as GDP income and applied within identifiable regions of the world or between developing and developed countries. This paper reports on the application of adapted methods within this discipline to the area of health care expenditure in the countries of the European Union in order to determine if differences in health care spending are diminishing over time. In answering this question we utilise two distinct approaches. The first tests for the presence of s-convergence using cross-sectional data over the period 1960-95 which provides an overall measure of change in dispersion for two chosen variables; total health expenditure as a share of GDP and per capita health expenditure. The second method utilises a panel of data for 1980-95 and tests for the presence of b-convergence in the same variables but also includes per capita income in the derivation of a regression model. Both methods confirm the presence of statistically significant convergence over the periods examined. Our results also identify sub-groupings based on health system typology and graphical representations illustrate which countries are contributing to the observed convergence. Our findings are important as they confirm that greater integration in health expenditure is occurring in the EU.

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Paper provided by Department of Economics, University of York in its series Discussion Papers with number 99/3.

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Handle: RePEc:yor:yorken:99/3

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Citations

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Cited by:
  1. Fabio Pammolli & Massimo Riccaboni & Laura Magazzini, 2012. "The sustainability of European health care systems: beyond income and aging," The European Journal of Health Economics, Springer, vol. 13(5), pages 623-634, October.
  2. 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.
  3. John Nixon, 2000. "Convergence of health care spending and health outcomes in the EUropean Union, 1960-95," Working Papers 183chedp, Centre for Health Economics, University of York.
  4. John Nixon, 2000. "How does the UK NHS compare with European standards? A review of EU health care systems using hierarchical cluster analysis," Working Papers 182chedp, Centre for Health Economics, University of York.
  5. Zijun Wang, 2009. "The convergence of health care expenditure in the US states," Health Economics, John Wiley & Sons, Ltd., vol. 18(1), pages 55-70.
  6. Tiia Püss & Mare Viies, 2004. "Changes in Socio-Demographic Situation and Social Convergence," Working Papers 114, Tallinn School of Economics and Business Administration, Tallinn University of Technology.
  7. Tiia Püss & Mare Viies & Reet Maldre, 2007. "Convergence Analysis of the Structure of Tax Revenue and Tax Burden in EU," Working Papers 166, Tallinn School of Economics and Business Administration, Tallinn University of Technology.
  8. Clemente, Jesus & Marcuello, Carmen & Montanes, Antonio & Pueyo, Fernando, 2004. "On the international stability of health care expenditure functions: are government and private functions similar?," Journal of Health Economics, Elsevier, vol. 23(3), pages 589-613, May.
  9. Anto Domazet & Rusmir Sendić & Adi Alić, 2012. "Convergence analysis of household expenditures using the absolute β-convergence method," Business Systems Research, Society for Promotion of Business Information Technology (BIT), vol. 3(1), pages 23-29.
  10. Bukenya, James O. & Gebremedhin, Tesfa G. & Schaeffer, Peter V., 2002. "Analysis Of Rural Quality Of Life And Health: A Spatial Approach," 2002 Annual meeting, July 28-31, Long Beach, CA 19878, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).

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