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Unit root properties of OECD health care expenditure and GDP data

Author

Listed:
  • Garry MacDonald

    (Department of Economics, Curtin University of Technology, Perth, Western Australia, Australia)

  • Sandra Hopkins

    (Department of Economics, Curtin University of Technology, Perth, Western Australia, Australia)

Abstract

This note reconsiders the unit root properties of health care expenditure (HCE) and gross domestic product (GDP) for OECD countries. The time-series properties of this data set has been much discussed in the literature with contrasting results from the application of a range of test procedures. We use a recently developed test to examine the relationship between the two variables. The results in this paper confirm earlier findings that when the data are considered as a panel, there is strong evidence of unit roots in both GDP and HCE data. Copyright © 2001 John Wiley & Sons, Ltd.

Suggested Citation

  • Garry MacDonald & Sandra Hopkins, 2002. "Unit root properties of OECD health care expenditure and GDP data," Health Economics, John Wiley & Sons, Ltd., vol. 11(4), pages 371-376.
  • Handle: RePEc:wly:hlthec:v:11:y:2002:i:4:p:371-376
    DOI: 10.1002/hec.657
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    References listed on IDEAS

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    3. Gerdtham, Ulf-G. & Lothgren, Mickael, 2000. "On stationarity and cointegration of international health expenditure and GDP," Journal of Health Economics, Elsevier, vol. 19(4), pages 461-475, July.
    4. Cheung, Yin-Wong & Lai, Kon S, 1995. "Lag Order and Critical Values of the Augmented Dickey-Fuller Test," Journal of Business & Economic Statistics, American Statistical Association, vol. 13(3), pages 277-280, July.
    5. Maddala, G S & Wu, Shaowen, 1999. " A Comparative Study of Unit Root Tests with Panel Data and a New Simple Test," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(0), pages 631-652, Special I.
    6. Hansen, Paul & King, Alan, 1996. "The determinants of health care expenditure: A cointegration approach," Journal of Health Economics, Elsevier, vol. 15(1), pages 127-137, February.
    7. Gerdtham, Ulf-G. & Sogaard, Jes & Andersson, Fredrik & Jonsson, Bengt, 1992. "An econometric analysis of health care expenditure: A cross-section study of the OECD countries," Journal of Health Economics, Elsevier, vol. 11(1), pages 63-84, May.
    8. Blomqvist, A. G. & Carter, R. A. L., 1997. "Is health care really a luxury?," Journal of Health Economics, Elsevier, vol. 16(2), pages 207-229, April.
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    Citations

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    Cited by:

    1. Andrea Leiter & Engelbert Theurl, 2012. "The convergence of health care financing structures: empirical evidence from OECD-countries," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 13(1), pages 7-18, February.
    2. Thomas Barnay & Olivier Damette, 2012. "What drives Health Care Expenditure in France since 1950?," Working Papers hal-00717435, HAL.
    3. Thomas Barnay & Olivier Damette, 2012. "What drives Health Care Expenditure in France since 1950? A time-series study with structural breaks and nonlinearity approaches," Working Papers halshs-00856117, HAL.
    4. Guglielmo Maria Caporale & Juncal Cunado & Luis A. Gil - Alana & Rangan Gupta, 2015. "The Relationship between Healthcare expenditures and Disposable Personal Income in the US States: A Fractional Integration and Cointegration Analysis," Working Papers 201532, University of Pretoria, Department of Economics.
    5. Paresh Kumar Narayan & Seema Narayan, 2008. "The role of permanent and transitory shocks in explaining international health expenditures," Health Economics, John Wiley & Sons, Ltd., vol. 17(10), pages 1171-1186.
    6. Narayan, Paresh Kumar, 2006. "Examining structural breaks and growth rates in international health expenditures," Journal of Health Economics, Elsevier, vol. 25(5), pages 877-890, September.
    7. Retzlaff-Roberts, Donna & Chang, Cyril F. & Rubin, Rose M., 2004. "Technical efficiency in the use of health care resources: a comparison of OECD countries," Health Policy, Elsevier, vol. 69(1), pages 55-72, July.
    8. Miller, Richard D. & Frech, Ted, 2002. "The Productivity of Health Care and Pharmaceuticals: Quality of Life, Cause," University of California at Santa Barbara, Economics Working Paper Series qt4b55f1xp, Department of Economics, UC Santa Barbara.
    9. Kamil Dybczak & Bartosz Przywara, 2010. "The role of technology in health care expenditure in the EU," European Economy - Economic Papers 2008 - 2015 400, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    10. 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.
    11. Ekaterini Panopoulou & Theologos Pantelidis, 2012. "Convergence in per capita health expenditures and health outcomes in the OECD countries," Applied Economics, Taylor & Francis Journals, vol. 44(30), pages 3909-3920, October.
    12. Zijun Wang & Andrew J. Rettenmaier, 2007. "A note on cointegration of health expenditures and income," Health Economics, John Wiley & Sons, Ltd., vol. 16(6), pages 559-578.
    13. Mohan, Ramesh & Mirmirani, Sam, 2007. "An Assessment of OECD Health Care System Using Panel Data Analysis," MPRA Paper 6122, University Library of Munich, Germany.
    14. Paresh Kumar Narayan, 2010. "Modelling health and output at business cycle horizons for the USA," Health Economics, John Wiley & Sons, Ltd., vol. 19(7), pages 872-880.
    15. repec:agr:journl:v:xxiv:y:2017:i:2(611):p:249-262 is not listed on IDEAS

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