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Income Elasticity of Vaccines Spending versus General Healthcare Spending
Author(s) -
Alfonso Y. Natalia,
Ding Guiru,
Bishai David
Publication year - 2016
Publication title -
health economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.55
H-Index - 109
eISSN - 1099-1050
pISSN - 1057-9230
DOI - 10.1002/hec.3190
Subject(s) - income elasticity of demand , economics , health care , elasticity (physics) , health spending , price elasticity of demand , marginal propensity to consume , gross domestic product , public economics , demographic economics , labour economics , economic growth , macroeconomics , microeconomics , health insurance , materials science , market liquidity , composite material
Using cross‐country data on gross domestic product and national expenditure on vaccines, we estimate and compare the income elasticity of vaccine expenditure and general curative healthcare expenditure. This study provides the first evidence on the national income elasticity of vaccination spending. Both fixed and random effects models are applied to data from 84 countries from 2010 to 2011. The income elasticities for healthcare expenditure and vaccine expenditure are 0.844 and 0.336, respectively. Despite vaccines' high cost‐effectiveness, the national propensity to spend income on vaccines as income increases lags behind general health care. The low income elasticity of vaccine spending means that relying on economic growth alone will provide an unacceptably slow trajectory to achieving high vaccine coverage levels. Copyright © 2015 John Wiley & Sons, Ltd.