Explaining variations in government health expenditure: evidence from Canada

Livio Di Matteo () and Fraser Summerfield
Additional contact information
Livio Di Matteo: Lakehead University

The European Journal of Health Economics, 2025, vol. 26, issue 6, No 8, 1067 pages

Abstract: Abstract We examine factors affecting Canadian government health expenditure during 1968–2022. Our data provide evidence on expenditure decisions from 10 autonomous but similar healthcare systems operating under common standards and regulations. We show that expenditure-income elasticity as measured in the literature is sensitive to controls for the social determinants of health, rising from 0.23 to 0.35. We also extend the literature with novel results for total and for specific expenditure categories that have grown unevenly in recent decades finding higher elasticity for physician than for drug or hospital spending. Physician supply increases both hospital and physician expenditures. Mid-life population shares, often overlooked in the literature, explain changes in the rapidly growing drug expenditure category. Our relatively long time series allows us to illustrate the sensitivity of results to dynamic specifications, account for a structural break in 1996 and show that income elasticity has risen over time.

Keywords: Health care expenditure; Government spending; Canada (search for similar items in EconPapers)
JEL-codes: C23 H51 I1 I18 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s10198-024-01735-6 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:eujhec:v:26:y:2025:i:6:d:10.1007_s10198-024-01735-6

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/10198/PS2

DOI: 10.1007/s10198-024-01735-6

Access Statistics for this article

The European Journal of Health Economics is currently edited by J.-M.G.v.d. Schulenburg

More articles in The European Journal of Health Economics from Springer, Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ) Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().