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Systems GMM estimates of the health care spending and GDP relationship: a note

  • Saten Kumar


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    This paper utilizes the systems generalized method of moments (GMM) [Arellano and Bover ( 1995 ) J Econometrics 68:29–51; Blundell and Bond ( 1998 ) J Econometrics 87:115–143], and panel Granger causality [Hurlin and Venet ( 2001 ) Granger Causality tests in panel data models with fixed coefficients. Mime’o, University Paris IX], to investigate the health care spending and gross domestic product (GDP) relationship for organisation for economic co-operation and development countries over the period 1960–2007. The system GMM estimates confirm that the contribution of real GDP to health spending is significant and positive. The panel Granger causality tests imply that a bi-directional causality exists between health spending and GDP. To this end, policies aimed at raising health spending will eventually improve the well-being of the population in the long run. Copyright Springer-Verlag 2013

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    Article provided by Springer in its journal The European Journal of Health Economics.

    Volume (Year): 14 (2013)
    Issue (Month): 3 (June)
    Pages: 503-506

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    Handle: RePEc:spr:eujhec:v:14:y:2013:i:3:p:503-506
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