Why Do Some Countries Spend More for Health? An Assessment of Sociopolitical Determinants and International Aid for Government Health Expenditures
A consensus exists that rising income levels and technological development are among the key drivers of total health spending. However, determinants of public sector health expenditure are less well understood. This study examines a complex relatio...
| Main Authors: | , |
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| Format: | Working Paper |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2014
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2014/01/19543916/some-countries-spend-more-health-assessment-sociopolitical-determinants-international-aid-government-health-expenditures http://hdl.handle.net/10986/19035 |
| Summary: | A consensus exists that rising income
levels and technological development are among the key
drivers of total health spending. However, determinants of
public sector health expenditure are less well understood.
This study examines a complex relationship across government
health expenditure (GHE), sociopolitical risks, and
international aid, while taking into account the impact of
national income and fiscal capacity on health spending. The
author apply a two-way fixed effects and two-stage least
squares regression method to a panel dataset comprising 120
countries for the years 1995 through 2010. Our results show
that democratic accountability has a diminishing positive
correlation with GHE, and that levels of spending are higher
when the government is more stable. Corruption is associated
with less spending in developing countries, but with more
spending in high-income countries. Furthermore, the author
find that development assistance for health (DAH)
substitutes for domestically financed government health
expenditure (DGHE). For an average country, a 1 percent
increase in total DAH or DAH to government is associated
with a 0.02 percent decrease in DGHE. Our work highlights
that policy reforms that aim to eliminate corruption are
fundamental to improving the capacity of developing
countries to scale up GHE, and to increasing the efficiency
of health care systems in developed countries in containing
health care costs. To minimize fungibility, donors may
impose stronger monitoring mechanisms for corruption.
Delivering aid through NGOs may be an option in countries
with high ethnic tensions; however, the ability to do so
depends on institutional arrangements and the capacity of
NGOs in individual countries. |
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