Public Health Expenditures and Population Health

Wasana Kalansooriya


Healthy population is a valuable resource for socio-economic development of acountry. Therefore, almost every country in the world pays significant attention toimproving health standards of its people using different policies. Governmentexpenditure on health is a prominent factor that shows the government intention toimprove and maintain good health standards of the country.

Even though the main justification of government expenditure on health care isthe enhancement of population health via equity provision, there are some argumentsthat government expenditures have not made such significance influence on improvingpopulation health. Therefore, this paper examines the impact of government healthexpenditures on population health in various countries using data for the year 2011. Lifeexpectancy at birth, infant mortality rate and child under 5 mortality rates are consideredas population health indicators and a regression analysis is carried out to capture theimpact.

The results show that the high income countries allocate more resource towardspublic provision of health care, while less developed countries allocate fewer. However,public health expenditures have caused to improve population health more effectively inlow income countries than in high income countries. Even though the rational forgovernment expenditures on health care is equity provision, the empirical data showsthat the rich people of the world get more benefits of government expenditure on healthcare than the poor. However, it is worthwhile to increase government expenditures onhealth care in developing countries as it increase the population health standards ofthose countries more effectively.

Key words: Public expenditure, Health care, Population health

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