Measuring health expenditures and outcomes in saarc region: health is a luxury?

• Published in: Quality & quantity 2014-05, Vol.48 (3), p.1421-1437
• Main Authors: Hassan, Syeda Anam, Zaman, Khalid, Zaman, Sajid, Shabir, Muhammad
• Format: Article
• Language: English
• Subjects: Afghanistan; Aged; Analysis; Births; Cooperation; Economic Development; Economic growth; Economic theory; Fatalities; Females; GDP; Gross Domestic Product; Health aspects; Health Care Costs; Health care expenditures; Health care policy; Health Care Services; Health expenditure; Health Problems; Infant Mortality; Infants; Information technology; Life expectancy; Literature reviews; Luxury; Maternal mortality; Measurement; Medical care, Cost of; Medical treatment; Methodology of the Social Sciences; Mortality Rates; Older people; Pakistan; Patient outcomes; Per capita; Population; Principal components analysis; Public health; Quality of Health Care; Social Sciences; South Asia; Studies; Transaction costs
• ISSN: 0033-5177; 1573-7845
• DOI: 10.1007/s11135-013-9844-2

The objective of the study is to investigate the link between health care expenditures (HCE), economic growth and health outcomes (i.e., life expectancy (LE), infant mortality and the share of elderly people) for a panel of South Asian Association for Regional Cooperation (SAARC) countries; namely, Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan and Sri Lanka; over the period of 1995–2010. The developed panel cointegration technique is employed for analysis of short and long-run relationship between the variables. The results of panel cointegration found that there is a long-run relationship between health expenditures, economic growth and health outcomes in SAARC region. The estimated results indicate that both, LE and share of elderly people in population have a negative relationship related to the HCEs which signifies that HCEs are luxury goods in SAARC countries. The burden of aging population can be lowered by provision of quality health services and utilization of their experience and knowledge in dynamics of economic development forecasting. Furthermore, there is no significant relationship found between infant mortality rate (IMR) and HCEs which implies that HCEs do not provide sufficient benefits to reduce infant mortality. Similarly, HCEs are not enough in generating GDP, lowering IMR and increasing LE in SAARC region. The implementation of appropriate tax reform, stable food prices and trade promotion for low transaction cost medical equipment is required for the SAARC region.