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Health expenditures, health outcomes and the role of good governance

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  • Marwa Farag
  • A. Nandakumar
  • Stanley Wallack
  • Dominic Hodgkin
  • Gary Gaumer
  • Can Erbil

Abstract

This paper examines the relationship between country health spending and selected health outcomes (infant mortality and child mortality), using data from 133 low and middle-income countries for the years 1995, 2000, 2005, and 2006. Health spending has a significant effect on reducing infant and under-5 child mortality with an elasticity of 0.13 to 0.33 for infant mortality and 0.15 to 0.38 for under-5 child mortality in models estimated using fixed effects methods (depending on models employed). Government health spending also has a significant effect on reducing infant and child mortality and the size of the coefficient depends on the level of good governance achieved by the country, indicating that good governance increases the effectiveness of health spending. This paper contributes to the new evidence pointing to the importance of investing in health care services and the importance of governance in improving health outcomes. Copyright Springer Science+Business Media New York 2013

Suggested Citation

  • Marwa Farag & A. Nandakumar & Stanley Wallack & Dominic Hodgkin & Gary Gaumer & Can Erbil, 2013. "Health expenditures, health outcomes and the role of good governance," International Journal of Health Economics and Management, Springer, vol. 13(1), pages 33-52, March.
  • Handle: RePEc:kap:ijhcfe:v:13:y:2013:i:1:p:33-52
    DOI: 10.1007/s10754-012-9120-3
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    2. Y. Natalia Alfonso & Guiru Ding & David Bishai, 2016. "Income Elasticity of Vaccines Spending versus General Healthcare Spending," Health Economics, John Wiley & Sons, Ltd., vol. 25(7), pages 860-872, July.
    3. Ali Nikzadian & Lotfali Agheli & Abbas Assari Arani & Hossein Sadeghi, 2019. "The Effects of Resource Rent, Human Capital and Government Effectiveness on Government Health Expenditure in Organization of the Petroleum Exporting Countries," International Journal of Energy Economics and Policy, Econjournals, vol. 9(2), pages 381-389.
    4. Bousmah, Marwân-al-Qays & Ventelou, Bruno & Abu-Zaineh, Mohammad, 2016. "Medicine and democracy: The importance of institutional quality in the relationship between health expenditure and health outcomes in the MENA region," Health Policy, Elsevier, vol. 120(8), pages 928-935.
    5. Deepak Kumar Behera & Umakant Dash, 2020. "Is health expenditure effective for achieving healthcare goals? Empirical evidence from South-East Asia Region," Asia-Pacific Journal of Regional Science, Springer, vol. 4(2), pages 593-618, June.
    6. Bienvenido Ortega & Jesús Sanjuán & Antonio Casquero, 2017. "Determinants of efficiency in reducing child mortality in developing countries. The role of inequality and government effectiveness," Health Care Management Science, Springer, vol. 20(4), pages 500-516, December.
    7. Ali Uyar & Cemil Kuzey & Merve Kilic & Abdullah S. Karaman, 2021. "Board structure, financial performance, corporate social responsibility performance, CSR committee, and CEO duality: Disentangling the connection in healthcare," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 28(6), pages 1730-1748, November.
    8. Kilishi, Abdulhakeem A & Obasa, Nimotullahi, 2018. "Governance And Inclusive Health System In Sub-Saharan Africa," Ilorin Journal of Economic Policy, Department of Economics, University of Ilorin, vol. 5(5), pages 26-45, June.
    9. S. M. Abdullah & Salina Siddiqua & Rumana Huque, 2017. "Is health care a necessary or luxury product for Asian countries? An answer using panel approach," Health Economics Review, Springer, vol. 7(1), pages 1-12, December.
    10. Mohanty, Ranjan Kumar & Behera, Deepak Kumar, 2020. "How Effective is Public Health Care Expenditure in Improving Health Outcome? An Empirical Evidence from the Indian States," Working Papers 20/300, National Institute of Public Finance and Policy.
    11. Issa Dianda & Idrissa Ouedraogo, 2021. "The synergistic effect of government health spending and institutional quality on health capital accumulation in WAEMU countries," Economics Bulletin, AccessEcon, vol. 41(2), pages 495-506.
    12. Sunhee Kim & Jaesun Wang, 2019. "Does Quality of Government Matter in Public Health?: Comparing the Role of Quality and Quantity of Government at the National Level," Sustainability, MDPI, vol. 11(11), pages 1-24, June.
    13. JunQiang Liu & Tao Chen, 2013. "Sleeping money: investigating the huge surpluses of social health insurance in China," International Journal of Health Economics and Management, Springer, vol. 13(3), pages 319-331, December.
    14. David M Bishai & Robert Cohen & Y Natalia Alfonso & Taghreed Adam & Shyama Kuruvilla & Julian Schweitzer, 2016. "Factors Contributing to Maternal and Child Mortality Reductions in 146 Low- and Middle-Income Countries between 1990 and 2010," PLOS ONE, Public Library of Science, vol. 11(1), pages 1-13, January.
    15. Abdalla Sirag & Norashidah Mohamed Nor & Nik Mustapha Raja Abdullah, 2017. "Health Financing: Does Governance Quality Matter?," Iranian Economic Review (IER), Faculty of Economics,University of Tehran.Tehran,Iran, vol. 21(3), pages 693-723, Summer.
    16. Rezwanul Hasan Rana & Khorshed Alam & Jeff Gow, 2020. "Health expenditure and gross domestic product: causality analysis by income level," International Journal of Health Economics and Management, Springer, vol. 20(1), pages 55-77, March.
    17. Olorunfemi Yasiru Alimi & Kazeem Bello Ajide, 2021. "The role of institutions in environment–health outcomes Nexus: empirical evidence from sub-Saharan Africa," Economic Change and Restructuring, Springer, vol. 54(4), pages 1205-1252, November.
    18. Zechariah Langnel & Ponlapat Buracom, 2020. "Governance, health expenditure and infant mortality in sub‐Saharan Africa," African Development Review, African Development Bank, vol. 32(4), pages 673-685, December.
    19. Smith, Lisa C. & Haddad, Lawrence, 2015. "Reducing Child Undernutrition: Past Drivers and Priorities for the Post-MDG Era," World Development, Elsevier, vol. 68(C), pages 180-204.
    20. Faisal Abbas & Haroon Sarwar Awan, 2018. "What Determines Health Status of Population in Pakistan?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 139(1), pages 1-23, August.

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    More about this item

    Keywords

    Health expenditures; Health outcomes; Child mortality; Infant mortality; Governance; Developing countries; H51; I12;
    All these keywords.

    JEL classification:

    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior

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