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A large number of studies have been conducted to examine the determinants of health expenditure, with GDP per capita appearing as the most important explanatory variable. Yet very few studies have examined the effect of environmental degradation, although it is intuitive to envisage that environmental considerations are bound to affect expenditure on healthcare for two reasons. The first reason is that environmental pollution has adverse effects on health, thus requiring more spending on healthcare. Gerdtham and Jonsson (1991) suggest that “the costs of environmental contamination are indisputable, and put greater pressure on government budgets, potentially requiring an increase in health care expenditure”. The second reason is that spending on environmental protection may reduce the need for more spending on healthcare as a clean environment is conducive to better health. The objective of this paper is to examine empirically the effect of environmental degradation, measured in terms of CO2 emissions, on health Abstract

Environmental considerations and the financing of healthcare: Evidence from sixteen European countries