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The ambiguous effects of remittances on health expenditure: a panel data analysis

Nicolas Yol

Economics Bulletin, 2017, vol. 37, issue 4, 2561-2573

Abstract: This article analyzes how remittances impact public health expenditure in developing countries. By using various estimation techniques on panel data covering 46 developing countries, we show that remittances increase private health expenditure and reduce public health spending. Remittances create a crowding-out effect at the expense of the public sector because (1) they increase the use of private services instead of public healthcare, and (2) they decrease public incentives for investments in health. Our conclusions are ambiguous because on the one hand remittances represent a powerful way to finance private health expenditure, while on the other hand they reduce the healthcare provision from the public sector.

Keywords: remittances; health expenditure; panel data; development economics (search for similar items in EconPapers)
JEL-codes: O1 I1 (search for similar items in EconPapers)
Date: 2017-11-19
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Working Paper: The ambiguous effects of remittances on health expenditure: a panel data analysis (2017)
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