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. 2017 Aug 17;7(1):29.
doi: 10.1186/s13561-017-0164-4.

Convergence and determinants of health expenditures in OECD countries

Son Hong Nghiem  1 , Luke Brian Connelly  2
Affiliations

Convergence and determinants of health expenditures in OECD countries

Son Hong Nghiem et al. Health Econ Rev. .

Abstract

This study examines the trend and determinants of health expenditures in OECD countries over the 1975-2004 period. Based on recent developments in the economic growth literature we propose and test the hypothesis that health care expenditures in countries of similar economic development level may converge. We hypothesise that the main drivers for growth in health care costs include: aging population, technological progress and health insurance. The results reveal no evidence that health expenditures among OECD countries converge. Nevertheless, there is evidence of convergence among three sub-groups of countries. We found that the main driver of health expenditure is technological progress. Our results also suggest that health care is a (national) necessity, not a luxury good as some other studies in this field have found.

Keywords: Convergence; Health expenditure; OECD countries.

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Conflict of interest statement

Competing interests

The authors declare that they have no competing interests.

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Figures

Fig. 1
Fig. 1
Commutative growth rates of selected variables (secondary verticle axis is used for : health expenditure per capita, CPI and GDP per capita)
Fig. 2
Fig. 2
Convergence tests. a σ-convergence (variations among countries decline over time), b β−convergence (poorer countries have higher growth rates)
See this image and copyright information in PMC

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