An empirical study on the determinants of health care expenses in emerging economies

Abstract

Background Emerging countries continue to suffer gravely from insufficient healthcare funding, which adversely affects access to quality healthcare and ultimately the health status of citizens. By using panel data from the World Development Indicators, the study examined the determinants of health care expenditure among twenty-two (22) emerging countries from the year 2000 to 2018. Methods The study employed cross-section dependence and homogeneity tests to confirm cross-sectional dependence and to deal with homogeneity issues. The Quantile regression technique is employed to test for the relationship between private and public health care expenses and its determinants. The Pooled mean group causality test is used to examine the causal connections among the variables. Results The outcome of the quantile regression test revealed that economic growth and aging population could induce healthcare costs in emerging countries. However, the impact of industrialization, agricultural activities, and technological advancement on health expenses are found to be noticeably heterogeneous at the various quantile levels. Unidirectional causality was found between industrialization and public health expenses; whereas two-way causal influence was reveled amongst public health expenditure and GDP per capita; public health expenditure and agricultural activities. Conclusion It is therefore suggested that effective and integrated strategies should be considered by industries and agricultural sectors to help reduce preventable diseases that will ultimately reduce healthcare costs among the emerging countries.

What Drives Healthcare Expenditure Growth? Evidence from Central and Eastern European Economies

“…The estimation results demonstrated that the income elasticity is positive and statistically significant both in the long and the short term. The study confirms the argument that, as a country's income increases, it tends to spend more on population healthcare, which supports the findings of Nghiem and Connelly (2017) and Zhou et al (2020). Income elasticity was estimated to be less than unity, suggesting that healthcare should be regarded as a necessity in CEE countries.…”

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Dynamics of Public Spending on Health and Socio-Economic Development in the European Union: An Analysis from the Perspective of the Sustainable Development Goals

“…It is also necessary to emphasise studies that highlight the bidirectional influence between the level of economic development (GDP per capita) and PSH per inhabitant. This research attempts to show how economic development affects PSH, and how investment in people’s health also boosts economic development by enabling people to remain active for longer and in better health [ 70 , 71 , 72 , 73 ]. Moreover, this public investment in health helps to reduce inequalities by limiting and hindering poverty and social exclusion [ 68 ].…”

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