The impacts of aging, income and urbanization on health expenditures: A panel regression analysis for OECD countries

Abstract

Objectives: The main purpose of this study is to investigate the factors affecting health expenditure levels through a panel data analysis. Methods: The study includes data from 35 OECD member countries between 2005 and 2015. We carried out panel regression analysis using STATA 13.0 econometric program. In the study, we used per capita health expenditure figures according to purchasing power parity as the dependent variable and we searched the impact of aging, urbanization and income on health expenditures with fixed effects panel regression model. Findings: The regression model indicates that aging, urbanization and income have positive effects on health expenditures per capita. For instance, a 1% increase in population ages 65+ causes an increase in health expenditures by $165 per capita. Conclusion: Although health expenditures are influenced by many factors, demographic structures and demographic changes, such as aging, urbanization and income, have a significant impact on health expenditures. Keywords: Health expenditures, OECD, aging, panel data analysis