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Convergence of Health Care Expenditures Across the US States: A Reconsideration

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Listed:
  • Nicholas Apergis

    () (University of Piraeus)

  • Tsangyao Chang

    (Feng Chia University)

  • Christina Christou

    (University of Piraeus)

  • Rangan Gupta

    (University of Pretoria)

Abstract

Abstract Current evidence on the convergence of health care expenditures across the US states into a single convergence club is non-existent. Against this backdrop, we use a modified panel unit root test that accounts for smooth structural changes, spanning the period of 1966–2009. The results illustrate that the ratio of the individual health care expenditures relative to the cross-sectional average is broken trend-stationary, not only in the aggregate panel, but also across all 50 US states. The findings also document that the evidence of convergence is possibly due to the convergence of personal disposable income across the US states.

Suggested Citation

  • Nicholas Apergis & Tsangyao Chang & Christina Christou & Rangan Gupta, 2017. "Convergence of Health Care Expenditures Across the US States: A Reconsideration," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 133(1), pages 303-316, August.
  • Handle: RePEc:spr:soinre:v:133:y:2017:i:1:d:10.1007_s11205-016-1357-7
    DOI: 10.1007/s11205-016-1357-7
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    More about this item

    Keywords

    Health care expenditures; Convergence; Unit root tests; Fourier function; Sequential panel selection methodology;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • I11 - Health, Education, and Welfare - - Health - - - Analysis of Health Care Markets

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