Yardstick competition in the japanese medical subsidy for infants and children
Yoshimi Adachi and
Hitoshi Saito ()
MPRA Paper from University Library of Munich, Germany
This paper explored the yardstick competition among Japanese municipalities in providing medical subsidy for infants and children. In recent years, against the background of rapidly declining birthrate in Japan, municipalities aimed to reduce the medical burden of families with small children. Municipalities had actively devised countermeasures to tackle the falling birthrate. In particular, granting of coverage under the Medical Subsidy for Infants and Children program significantly expanded with the upper limit set by many municipalities being higher than that of corresponding prefectures. In this paper, we have demonstrated how to determine the upper age of the Medical Subsidy for Infants and Children program by each municipality. Two facts on Japanese Medical Subsidy for Infants and Children program have emerged from our estimation results. First, we showed that the upper limit established by municipalities for the Medical Subsidy for Infants and Children program had been expanded by two contributory factors. One was caused by the expanding of the upper limit by the prefectures, while the other cause was triggered by horizontal externalities. In addition, the effect of the former factor on the expansion was larger than that of the latter. Finally, we obtained the result that the yardstick competition, as was discussed by Besley and Case (1995), had occurred between the municipalities’ Medical Subsidy for Infants and Children program. Therefore, the yardstick competition among municipalities in 2010–2012 was considered to be the main reason for the expansion of the upper limit of the Medical Subsidy for Infants and Children program.
Keywords: Yardstick Competition; Medical Subsidy for Infants and Children; Intergovernmental Relations (search for similar items in EconPapers)
JEL-codes: H72 H75 H77 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:63344
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