Abstract
BackgroundSub-Saharan African (SSA) countries that currently face enormous healthcare challenges have implemented national health policies focusing on regional or international health commitments. These health commitments generally promote new healthcare financing policies (e.g., health insurance, user fee exemption and results-based financing) with the objective of providing ever-larger population cohorts with human capital and better health in particular. To achieve this, governments must involve themselves more fully in their respective healthcare sectors through the mobilisation of public funding.ObjectiveThis paper aims to examine convergence in health expenditure throughout SSA. The findings of club convergence will allow a robust comparison of health indicators between countries and will be suitable for the adjustment of health policies to foster the efficiency of such policies at the regional and/or country level. Such findings could also help with the conception and implementation of health policies at the regional level.MethodsWe used the methodology of convergence analysis based on dynamic factor modelling leading to the logt regression to test for full convergence, club convergence and club clustering of health expenditure on a balanced panel of 44 countries in Sub-Saharan Africa spanning the period from 2000 to 2016.ResultsOverall, our results do not support the hypothesis that all SSA countries converge to a single equilibrium state regarding public health expenditure. When testing for club convergence, the results highlight eight convergence clubs and one group of diverging countries. Indeed, performing the club clustering algorithm reveals the existence of three convergence clubs and the diverging group. The three clubs consist of 12, 14 and 14 members, respectively, where convergence is found to occur among different regional economic organisations.ConclusionOur findings indicate that SSA governments should increase spending on healthcare in order to align their healthcare systems with a global convergence model. To foster the convergence to a single equilibrium state in public health expenditure, attention could be paid to strengthening integration within the various regional economic organisations and to the coordination and integration of healthcare policies within and across convergence clubs throughout SSA.
Highlights
Healthcare is an increasingly important sector of the global economy, as reflected in the ever-increasing levels of health expenditure around the world [1]
To foster the convergence to a single equilibrium state in public health expenditure, attention could be paid to strengthening integration within the various regional economic organisations and to the coordination and integration of healthcare policies within and across convergence clubs throughout Sub-Saharan African (SSA)
Our methodology has two important advantages [13]. It allows for the possibility of transitional heterogeneity and remains robust to the stationarity properties of the series. It is useful for identifying any subgroups among converging countries when there is a divergence in the panel of countries under scrutiny
Summary
Background Healthcare is an increasingly important sector of the global economy, as reflected in the ever-increasing levels of health expenditure around the world [1]. Health expenditure has become a major concern in several studies in the field of health economics Research in this field can be classified into two main groups. The second research group recently highlights a growing interest in convergence analysis of health expenditure by investigating the convergence hypothesis of health expenditure among a panel of countries or among separate regions within a country [1, 12,13,14,15,16,17]. Borrowing the concept of economic convergence from neoclassical growth theory, health economists in this second research group have considered convergence of health care expenditure between the OECD countries or between the EU member countries [13]. Sub-Saharan African (SSA) countries that currently face enormous healthcare challenges have implemented national health policies focusing on regional or international health commitments. Convergence can be proven by testing, even when it does not exist
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