Health Financing: Does Governance Quality Matter?

Abdalla Sirag (), Norashidah Mohamed Nor () and Nik Mustapha Raja Abdullah ()
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Abdalla Sirag: Department of Economics, University of Medical Sciences and Technology, Khartoum, Sudan.
Nik Mustapha Raja Abdullah: Department of Economics, Universiti Putra Malaysia, Selangor, Malaysia.

Iranian Economic Review (IER), 2017, vol. 21, issue 3, 693-723

Abstract: This paper contributes to the existing literature by examining the determinants of health financing in 177 developed and developing countries. The study introduces the variables of government effectiveness and control of corruption to capture the impact of governance quality on differentmechanismsof health financing.Utilisngpanel data analysis, namely system-GMM estimators, to obtain unbiased estimates, the results indicate that public and private health financing do not follow the same pattern. In addition, the GDP per capita and total government expenditure iscrucial factors that affect health financing in both developed and developing countries. External aid tends to reduce public healthfinancing, especially when it is received by a country with lowgovernancequality. Interestingly, a high level of government effectiveness and control of corruption are found to be very influential in stimulating public health financing and helping to reduce private health financing in developed countries. However, the low amounts of health financing in developing countries are attributable to the low quality of governance, which increases out-of-pocket health financing.

Keywords: Health Care; Health Financing; Governance Quality; System-GMM. (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (1)

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