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 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.

Bibliographic Details

Main Authors:	Liang, Li-Lin, Mirelman, Andrew J.
Language:	English en_US
Published:	World Bank, Washington, DC 2014-01
Subjects:	ACCOUNTABILITY, AGGREGATE HEALTH EXPENDITURE, AGGREGATE INCOME, ANTICORRUPTION, ANTICORRUPTION REFORMS, BRIBES, CABINET, COALITION GOVERNMENT, CORRUPT, CORRUPTION, CORRUPTION IN GOVERNMENT, DEBT, DELIVERY SYSTEM, DEMOCRACIES, DEMOCRACY, DEMOCRATIC ACCOUNTABILITY, DEMOCRATIC SYSTEMS, DETERMINANTS OF HEALTH, ECONOMETRIC ANALYSIS OF HEALTH CARE EXPENDITURE, ECONOMIC REVIEW, ELECTION, EXTERNAL DEBT, FINANCIAL RESOURCES, FISCAL POLICY, FRAUD, HEALTH AFFAIRS, HEALTH CARE, HEALTH CARE COSTS, HEALTH CARE EXPENDITURE, HEALTH CARE FINANCE, HEALTH CARE REFORM, HEALTH CARE SPENDING, HEALTH CARE SYSTEMS, HEALTH COVERAGE, HEALTH ECONOMICS, HEALTH EXPENDITURE, HEALTH EXPENDITURE GROWTH, HEALTH EXPENDITURES, HEALTH FINANCING, HEALTH INSURANCE, HEALTH INSURANCE COVERAGE, HEALTH ORGANIZATION, HEALTH OUTCOMES, HEALTH POLICY, HEALTH PROGRAMS, HEALTH RESOURCES, HEALTH SECTOR, HEALTH SERVICES, HEALTH SPENDING, HEALTH SYSTEMS, HOSPITAL SYSTEMS, HUMAN DEVELOPMENT, HUMAN RESOURCES, INCENTIVE STRUCTURES, INCOME COUNTRIES, INCOME ELASTICITY, INCOME ELASTICITY OF HEALTH CARE, INCOME GROUPS, INFORMAL SECTOR, INSURANCE PREMIUMS, INTERNATIONAL HEALTH CARE, INVESTIGATION, KICKBACKS, LEADERSHIP, LOW-INCOME COUNTRIES, MEDICAL RESOURCES, MEDICAL TECHNOLOGY, MONITORING MECHANISMS, NATIONAL HEALTH, NEPOTISM, NUTRITION, OLDER PEOPLE, PATRONAGE, POCKET PAYMENT, POLITICAL INTERESTS, POLITICAL OPPONENTS, POLITICAL PARTY, POLITICAL SYSTEM, POLITICAL SYSTEMS, POLITICIANS, PRIVATE HEALTH SERVICES, PRIVATE SECTOR, PROVISION OF HEALTH CARE, PUBLIC HEALTH, PUBLIC HEALTH CARE, PUBLIC HEALTH SPENDING, PUBLIC POLICY, PUBLIC SECTOR, PUBLIC SPENDING, SOCIAL HEALTH INSURANCE, SOCIAL WELFARE, TRANSPARENCY, TUBERCULOSIS,
Online Access:	http://documents.worldbank.org/curated/en/2014/01/19543916/some-countries-spend-more-health-assessment-sociopolitical-determinants-international-aid-government-health-expenditures https://hdl.handle.net/10986/19035
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