Does Spending Matter in Improving Healthcare Across MENA Region
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Published
Apr 19, 2020
Abstract
This study addresses the impact of healthcare spending on quality of health. Particularly, it
investigates the impact of health budget allocation, health system performance, a nation’s
income, and demographic aspects on prompting health quality across the MENA region. The
yearly data sample used covers the period 1995–2016. The estimated model is tested using the
appropriate GLS random effects method. The findings do not show support for public spending
on healthcare to improve healthcare quality across the MENA region. However, higher private
spending on healthcare leads to lower infant mortality rates, thus improving healthcare quality.
The results also show that the improvement in income per-capita for oil-exporting countries
leads to improved quality of healthcare as well as in non-oil-exporting countries, however the
marginal benefit is lower for oil-exporting countries, compared to non-oil-exporting countries.
This might suggest that oil-exporting countries have already reached a significant floor level
of infant mortality rate that cannot be improved. However, non-oil-exporting countries still
have potential to reduce the infant mortality rate and improve the quality of healthcare.
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Keywords
Health QualityBudget AllocationOil ExportersMENA
References
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expenditure in sub-Saharan Africa. Oxford Developmental Studies, 36(4), 363-377
Gupta, S., Verhoeven, M. and Tiongson, E. R. (2002). The effectiveness of government
spending on education and health care in developing and transition economies. European
Journal of Political Economy, 18(4), 717–737.
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Economics, 28(3), 281–290.
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International Journal of Business Management and Economic Research, 3(1), 425-428.
Mendis, K. A. and Ichihashi, M. (2014). Impact of government spending on education and
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Ravallion, M. and Bidani, B. (1999). Decomposing social indicators using distributional data.
Washington Dc, the World Bank.
Rhee, H. (2014) Effects of healthcare expenditure on national income: a rational expectation
approach. Advanced Science and Technology Letters, 70, 19–23.
Sadr, S., and Gudarzi, Y. (2013). Consideration the effect of e-health expenditure on economic
growth in Iran with VAR approach. Asian Journal of Business and Management
Sciences, 2(3), 35–42.
Schultz, T. P. (1993). Mortality decline in the low-income world: Causes and consequences.
The American Economic Review, 83(2), 337–342.
Seddighi, H., and Lawler, K. A., . (2000). Econometrics: a practical approach. Psychology
Press. London, England: Routledge.
Serdar, K. (2015). Government health expenditures and economic growth: a Feder–Ram
approach for the case of Turkey. International Journal of Economics and Financial
Issues, 5(2), 441–447.
Swift, R. (2011). The relationship between health and GDP in OECD countries in the very long
run. Health Econ, 20, 306–322.
Verhoeven, M., Gupta, M. S. and Tiongson, M. E. (1999). Does higher government spending
buy better results in education and health care? International Monetary Fund.
Wang, K., & Lee, Y. (2018). The impacts of life insurance asymmetrically on health
expenditure and economic growth: Dynamic panel threshold approach. Applied
Economics Letter, 31(1).
Yazdi, S. and Khanalizadeh, B. (2017). Air pollution, economic growth and health care
expenditure. Economic Research-Ekonomska Istraživanja, 30(1), 1181-1190.
Proceedings of the Royal Society of Edinburgh, 55, 42–48.
Ali, M., Ismatullah, M. and Ashghar, M. (2017). Effect of health expenditure on GDP, a panel
study based on Pakistan, China, India and Bangladesh. International Journal of Health
Economics and Policy, 2(2), 57-62
Anand, S. and Ravallion, M. (1993). Human development in poor countries: On the role of
private incomes and public services. Journal of economic perspectives, 7(1), 133–150.
Bakare, A. and Olubokun, S. (2011), Health care expenditure and economic growth in Nigeria:
an empirical study. Journal of Emerging Trends in Economics and Management
Sciences, 2(2), 83–87.
Baltagi, B. H. and Moscone, F. (2010). Health care expenditure and income in the OECD
reconsidered: Evidence from panel data. Economic Modelling, 27(4), 804–811.
Bedir, S. (2016). Healthcare expenditure and economic growth in developing countries.
Advances in Economics and Business, 4(2), 76–86.
Churchill, S., Yew, S., & Ugur, M. (2015). Effects of government education and health
expenditures on economic growth: a meta-analysis. Discussion Paper 40/15. Australia,
Monash Business School.
Cima, J. and Almieda, A. (2018). Health expenditure, GDP growth and the financial crisis: a
panel data analysis for OECD European countries. (No. 602). Portugal, Universidad do
Porto.
Cooray, A. (2013). Does health capital have differential effects on economic growth? Applied
Economics Letters, 20(3), 244-249.
Filmer, D., Hammer, J. and Pritchett, L. (1998). Health policy in poor countries: Weak links in
the chain. Washington Dc, World Bank, Policy Research Working Paper Number 1874.
Fosu, A. K. (2008). Implications of the external debt-servicing constraint for public health
expenditure in sub-Saharan Africa. Oxford Developmental Studies, 36(4), 363-377
Gupta, S., Verhoeven, M. and Tiongson, E. R. (2002). The effectiveness of government
spending on education and health care in developing and transition economies. European
Journal of Political Economy, 18(4), 717–737.
Hojman, D. E. (1996). Economic and other determinants of infant and child mortality in small
developing countries: the case of Central America and the Caribbean. Applied
Economics, 28(3), 281–290.
Ke, X., Saksena, P. and Holly, A. (2011). The determinants of health expenditure: a countrylevel
panel data analysis. Geneva: World Health Organization, (No. 26).
Kreft, I. G., & De Leeuw, J. (1998). Introducing multilevel modeling. Sage.
Mehrara, M., Akbar, A., Abbas, A., & Reza, A. (2012). The relationship between health
expenditures and economics growth in Middle East & North Africa (MENA) countries.
International Journal of Business Management and Economic Research, 3(1), 425-428.
Mendis, K. A. and Ichihashi, M. (2014). Impact of government spending on education and
health in Sri Lanka: a provincial level analysis (No. 4–8). Hiroshima University,
Graduate School for International Development and Cooperation (IDEC).
Ndedi, A., Metha, A. and Nisabwe, F. (2017). The impact of health expenditures on economic
growth of Cameroon: a literature review perspective. Social Science Research Network.
Newhouse, J. (1977). Medical care expenditure: a cross-national survey. Journal of Human
Resources, 12, 115–125.
Rajkumar, A. S. and Swaroop, V. (2008). Public spending and outcomes: Does governance
matter? Journal of Development Economics, 86(1), 96–111.
Ravallion, M. and Bidani, B. (1999). Decomposing social indicators using distributional data.
Washington Dc, the World Bank.
Rhee, H. (2014) Effects of healthcare expenditure on national income: a rational expectation
approach. Advanced Science and Technology Letters, 70, 19–23.
Sadr, S., and Gudarzi, Y. (2013). Consideration the effect of e-health expenditure on economic
growth in Iran with VAR approach. Asian Journal of Business and Management
Sciences, 2(3), 35–42.
Schultz, T. P. (1993). Mortality decline in the low-income world: Causes and consequences.
The American Economic Review, 83(2), 337–342.
Seddighi, H., and Lawler, K. A., . (2000). Econometrics: a practical approach. Psychology
Press. London, England: Routledge.
Serdar, K. (2015). Government health expenditures and economic growth: a Feder–Ram
approach for the case of Turkey. International Journal of Economics and Financial
Issues, 5(2), 441–447.
Swift, R. (2011). The relationship between health and GDP in OECD countries in the very long
run. Health Econ, 20, 306–322.
Verhoeven, M., Gupta, M. S. and Tiongson, M. E. (1999). Does higher government spending
buy better results in education and health care? International Monetary Fund.
Wang, K., & Lee, Y. (2018). The impacts of life insurance asymmetrically on health
expenditure and economic growth: Dynamic panel threshold approach. Applied
Economics Letter, 31(1).
Yazdi, S. and Khanalizadeh, B. (2017). Air pollution, economic growth and health care
expenditure. Economic Research-Ekonomska Istraživanja, 30(1), 1181-1190.
How to Cite
Alshammari, Nayef N., Wael M. Alshuwaiee, and Ibrahim Mirza. 2020. “Does Spending Matter in Improving Healthcare Across MENA Region”. Studies in Business and Economics 22 (1):05-23. https://doi.org/10.29117/sbe.2019.0111.
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Articles