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New panel results on cointegration of international health expenditure and GDP

Gerdtham, Ulf LU and Lothgren, M (2002) In Applied Economics 34(13). p.1679-1686
Abstract
This article tests for existence of cointegration between health expenditure and GDP using data from 25 OECD countries for the period 1960-1997. The empirical modelling is based on a heterogeneous bivariate vector error correction panel model that allows for trending data as well as intercepts and trends in the cointegrating relations. Univariate country-by-country and panel unit root tests generally fail to reject the null of a unit root in the health expenditure and GDP variables. Country-by-country results based on the Johansen multivariate likelihood-based inference indicate somewhat mixed results on country-specific cointegration with a rank of one found for 12 countries and a rank of zero for the remaining 13 countries. Application... (More)
This article tests for existence of cointegration between health expenditure and GDP using data from 25 OECD countries for the period 1960-1997. The empirical modelling is based on a heterogeneous bivariate vector error correction panel model that allows for trending data as well as intercepts and trends in the cointegrating relations. Univariate country-by-country and panel unit root tests generally fail to reject the null of a unit root in the health expenditure and GDP variables. Country-by-country results based on the Johansen multivariate likelihood-based inference indicate somewhat mixed results on country-specific cointegration with a rank of one found for 12 countries and a rank of zero for the remaining 13 countries. Application of a new panel test for cointegration rank with higher power than the individual tests indicates that health expenditure and GDP are cointegrated around linear trends. (Less)
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author
organization
publishing date
type
Contribution to journal
publication status
published
subject
in
Applied Economics
volume
34
issue
13
pages
1679 - 1686
publisher
Routledge
external identifiers
  • wos:000177556800010
  • scopus:0037056098
ISSN
1466-4283
DOI
10.1080/00036840110116397
language
English
LU publication?
yes
id
f24c945d-7094-443e-aa2a-06eb1199377a (old id 892744)
date added to LUP
2008-01-22 09:29:35
date last changed
2017-07-30 03:40:58
@article{f24c945d-7094-443e-aa2a-06eb1199377a,
  abstract     = {This article tests for existence of cointegration between health expenditure and GDP using data from 25 OECD countries for the period 1960-1997. The empirical modelling is based on a heterogeneous bivariate vector error correction panel model that allows for trending data as well as intercepts and trends in the cointegrating relations. Univariate country-by-country and panel unit root tests generally fail to reject the null of a unit root in the health expenditure and GDP variables. Country-by-country results based on the Johansen multivariate likelihood-based inference indicate somewhat mixed results on country-specific cointegration with a rank of one found for 12 countries and a rank of zero for the remaining 13 countries. Application of a new panel test for cointegration rank with higher power than the individual tests indicates that health expenditure and GDP are cointegrated around linear trends.},
  author       = {Gerdtham, Ulf and Lothgren, M},
  issn         = {1466-4283},
  language     = {eng},
  number       = {13},
  pages        = {1679--1686},
  publisher    = {Routledge},
  series       = {Applied Economics},
  title        = {New panel results on cointegration of international health expenditure and GDP},
  url          = {http://dx.doi.org/10.1080/00036840110116397},
  volume       = {34},
  year         = {2002},
}