Local neighbourhood effect on hospitalisation expenditure in India

Namrata Gulati () and Vikash Gautam ()
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Namrata Gulati: Department of Economics, South Asian University

Economics Bulletin, 2021, vol. 41, issue 4, 2291-2299

Abstract: How do social forces influence an individual's attitude towards healthcare? We address this question by analysing the effect of neighbourhoods on individuals' hospitalisation expenditure in India. Using data on 8,269 neighbourhoods and employing a two-stage least absolute deviation estimation method, the results suggest that (1) hospitalisation expenditure of the median individual increases by 0.9 percent with a one percent increase in hospitalisation expenditure of neighbours, while it falls by roughly 0.6 percent with one standard deviation increase in the dispersion of hospitalisation expenditure of neighbours; and (2) disposable income elasticity of hospitalization expenditure is nearly 0.2, suggesting hospitalisation is a necessity. Policy interventions such as improved affordability of hospitalisation-related services may significantly benefit equitable healthcare in the country.

JEL-codes: I1 R2 (search for similar items in EconPapers)
Date: 2021-12-29
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