Pooling international health care expenditure data

The purpose of this paper is twofold. The first is to analyse the statistical relationship between real health care expenditure per capita and aggregate income, public share in finance, age‐dependency ratio and inflation. The second purpose deals with methodological problems involved in pooling health care expenditure data. The empirical work is based on pooled cross‐sectional, time‐series data for 22 OECD countries from 1972 to 1987. Public finance share and inflation were found to be associated with lower per capita health care expenditure. No consistent correlation was found between the age‐dependency ratio and health care expenditure. Contrary to results of earlier studies, we found that health care expenditure does not appear to be income (GDP) elastic. However, the results do not appear to be robust to changes in the time periods and countries included.