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Tax Financed Government Health Expenditure and Growth with Capital Deepening Externality

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  • Hosoya, Kei
  • 細谷, 圭
  • ホソヤ, ケイ

Abstract

This paper develops a two-sector endogenous growth model with health capital and examines the impact tax financed health expenditure has on long-run growth. In this model, health capital is accumulated through government spending as a flow channel and a capital deepening externality as a stock channel. When arguing about the problem of growth maximizing flat tax, the latter channel plays a significant role for determining tax rate.

Suggested Citation

  • Hosoya, Kei & 細谷, 圭 & ホソヤ, ケイ, 2003. "Tax Financed Government Health Expenditure and Growth with Capital Deepening Externality," Discussion Paper 153, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
    • Handle: RePEc:hit:piedp1:153
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    File URL: https://hermes-ir.lib.hit-u.ac.jp/hermes/ir/re/14534/pie_dp153.pdf
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    References listed on IDEAS

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    1. van Zon, Adriaan & Muysken, Joan, 2001. "Health and endogenous growth," Journal of Health Economics, Elsevier, vol. 20(2), pages 169-185, March.
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    Cited by:

    1. Stefano Bosi & Thierry Laurent, 2008. "Health, Growth and Welfare: Why Put Public Money on Medical R&D?," Documents de recherche 08-18, Centre d'Études des Politiques Économiques (EPEE), Université d'Evry Val d'Essonne.
    2. Agénor, Pierre-Richard, 2008. "Health and infrastructure in a model of endogenous growth," Journal of Macroeconomics, Elsevier, vol. 30(4), pages 1407-1422, December.
    3. Gong, Liutang & Li, Hongyi & Wang, Dihai, 2012. "Health investment, physical capital accumulation, and economic growth," China Economic Review, Elsevier, vol. 23(4), pages 1104-1119.
    4. Stefano Bosi & Thierry Laurent, 2011. "Health, Growth and Welfare: A Theoretical Appraisal of the Long-Run Impact of Medical R&D," Asia-Pacific Journal of Accounting & Economics, Taylor & Francis Journals, vol. 18(3), pages 307-332.
    5. Kei Hosoya, 2017. "Accounting for Growth Disparity: Lucas's Framework Revisited," Review of Development Economics, Wiley Blackwell, vol. 21(3), pages 874-887, August.
    6. Nursini Nursini, 2017. "Effect of Fiscal Policy and Trade Openness on Economic Growth in Indonesia: 1990-2015," International Journal of Economics and Financial Issues, Econjournals, vol. 7(1), pages 358-364.
    7. Hosoya, Kei & 細谷, 圭 & ホソヤ, ケイ, 2005. "The Speed of Convergence in a Two-Sector Growth Model with Health Capital," Discussion Paper 245, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
    8. Liutang Gong & Hongyi Li & Dihai Wang & Heng-fu Zou, 2010. "Health, Taxes, and Growth," Annals of Economics and Finance, Society for AEF, vol. 11(1), pages 73-94, May.
    9. Dihai Wang & Heng-fu Zou, 2011. "The Fogel Approach to Health and Growth," CEMA Working Papers 520, China Economics and Management Academy, Central University of Finance and Economics.

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    More about this item

    Keywords

    Health capital; Capital deepening externality;

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • I10 - Health, Education, and Welfare - - Health - - - General

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