Is health care really a luxury?
Much of the work which has led to a widely held view that the income elasticity of health care spending exceeds one has been based on international cross-section data, or on pooled cross-sections and time series. In this paper we re-examine this view in the context of long-run equilibrium relationships between non-stationary time series, possibly including autonomous trends. Our results cast doubt upon the usefulness of pooling and upon the notion of an elasticity above one.
Blomqvist
A G
AG
Department of Economics, University of Western Ontario, London, Canada. blomqvist@sscl.uwo.ca
Carter
R A
RA
D002170:Canada; D003430:Cross-Sectional Studies; D005102:Health Expenditures / Q000706:statistics & numerical data* / Q000639:trends; D006301:Health Services Needs and Demand / Q000191:economics*; D006302:Health Services Research / Q000379:methods; D007182:Income / Q000706:statistics & numerical data* / Q000639:trends; D007348:Insurance, Health / Q000191:economics / Q000706:statistics & numerical data; D017059:Models, Econometric