Secessions of Municipal Health Centre Federations: Expenditure and Productivity Effects

Kalevi Luoma, Antti Moisio and Juho Aaltonen

No 425, Discussion Papers from VATT Institute for Economic Research

Abstract: We examine the expenditure and efficiency effects of secessions of health centre federations between 1990 and 2003. Using both regression and matching techniques we find statistically significant effects. According to results, the per capita primary health care expenditure growth is approximately five percent higher in seceded health centres compared to all non-seceded health centres. Using nearest neighbour matching, we find that the average secession effect is eight percent on per capita primary health care expenditures. We find no effect on specialised health care expenditures. Using an indicator of health centre service volume, we find that secessions had no positive effects on the productivity development in the long term. The rapid expenditure growth of seceded health centres can thus be explained both by increasing service volume and decreasing productivity. Key words: Health care expenditures, health centre secessions, economies of scale

Keywords: Health care expenditures; health centre secessions; economies of scale; Local public economics; Kunnallistalous; Public services; Julkiset palvelut; Effectiveness of public services; Julkisten palvelujen vaikuttavuus (search for similar items in EconPapers)
Date: 2007
New Economics Papers: this item is included in nep-eff and nep-hea
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