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Regional inequality in China's health care expenditures.

Health economicsยท2009
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Explaining China's regional health expenditures using LM-type unit root tests.

Win Lin Chou1

  • 1Department of Economics, Chinese University of Hong Kong, Shatin, Hong Kong. winlinchou@cuhk.edu.hk

Journal of Health Economics
|January 16, 2007
PubMed
Summary

Government budget deficits significantly impact China's health care expenditure, revealing disparities in financing and service coverage between wealthy and impoverished regions.

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Area of Science:

  • Health Economics
  • Public Policy
  • Econometrics

Background:

  • Investigates determinants of healthcare expenditure in China.
  • Addresses income and non-income factors influencing health spending.
  • Utilizes pooled cross-section and time series data for comprehensive analysis.

Purpose of the Study:

  • To examine the long-run relationship between healthcare expenditure, income, and other factors in China.
  • To analyze the impact of government budget deficits on national healthcare spending.
  • To provide evidence on regional disparities in healthcare financing and coverage.

Main Methods:

  • Employs panel Lagrange Multiplier (LM) unit root tests accounting for structural changes.
  • Utilizes bootstrap methods for finite-sample critical values in unit root testing.
  • Applies panel cointegrated regression analysis to estimate long-run relationships.

Main Results:

  • Government budget deficits demonstrate a significant long-run impact on China's healthcare expenditure.
  • Findings support the existence of disparities in healthcare financing policies across regions.
  • Evidence suggests substantial differences in health service coverage linked to economic factors.

Conclusions:

  • Government fiscal policy, specifically budget deficits, is a critical determinant of healthcare expenditure in China.
  • The study highlights the need to address regional inequalities in healthcare access and financing.
  • Results underscore the complex interplay between economic factors and health service provision in China.