Who’s going broke? Comparing growth in Public healthcare expenditure in Ten OECD Countries

Christian Hagist () and Laurence Kotlikoff
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Christian Hagist: Freiburg University

Hacienda Pública Española / Review of Public Economics, 2009, vol. 188, issue 1, 55-72

Abstract: Government healthcare expenditures have been growing much more rapidly than GDP in OECD countries. How much of this growth is due to demographic change versus increases in benefit levels (expenditures per person at a given age)? This paper answers this question for ten OECD countries –Australia, Austria, Canada, Germany, Japan, Norway, Spain, Sweden, the UK, and the U.S. using data from 1970-2002. Growth in benefit levels explains 89 of overall healthcare spending growth in the ten countries over the period, with Norway, Spain, and the U.S. recording the highest annual benefit growth rates. As we show, allowing government healthcare benefit levels to grow at historic rates is fraught with danger given the impending retirement of the baby boom generation.

Keywords: Healthcare expenditure growth; long-term fiscal imbalance (search for similar items in EconPapers)
JEL-codes: H51 I11 (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (1)

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