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Are Healthcare Expenditures Related to Economic Growth in China? Bootstrap ARDL Approach
Yu-Cheng Chang1, Tsangyao Chang2, Mei-Chih Wang3
1Department of Leisure and Recreation Management, Asia University, Taichung, Taiwan.
Abstract:
This study attempts to investigate whether healthcare expenditures (HCE) are related to economic growth in China using a newly developed Bootstrap autoregressive distributed lag (ARDL) test for China over the period of 1990-2019. To avoid omitted variable bias, we use the ratio of the population of 65 years old over the total population (aging ratio) as a control variable. Empirical result indicates that no cointegration among these three variables. Granger causality test based on Bootstrap ARDL model demonstrates that one-way Granger causality running from HCE to aging ratio and from economic growth to both HCE and aging ratio. Empirical results have important policy implications for China understudy.
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