Abstract
BackgroundSince the mid-2000s, the Chinese government has increased government health expenditures (GHE) significantly to address widespread complaints about health delivery. This study examines the real per capita provincial GHE over the period 2007–2013 to identify the determinants of provincial GHE during the most recent round of health reforms.MethodsA range of theoretically grounded socioeconomic indicators were collected from the China Statistical Yearbooks and then factored to reduce the number of highly correlated indicators. Maps were drawn to visualise the spatial patterns of key variables and fixed-effects regressions were run to test relationships between the real per capita provincial GHE and various variables. GMM estimators were used to address endogeneity problems.ResultsKey determinants of provincial GHE in China include the real per capita budgetary deficits, economy, and industrial structure (two factors composed from an exploratory factor analysis). Increasing 1000 yuan real per capita budgetary deficits was expected to increase the real per capita GHE by 34 yuan. A one-unit increase in the economy was associated with a 249 yuan higher real per capita GHE, while a one-unit increase in the industrial structure was expected to decrease the real per capita GHE by 33 yuan.ConclusionsThe findings of this study reveal a worrisome picture: potential inefficiencies of the central government’s funding efforts and the overwhelming importance of economic development for GHE.
Highlights
IntroductionAs a response to widespread complaints of growing inequality-related health problems, the Chinese government has initiated and implemented a series of policy changes since the mid-2000s
Since the mid-2000s, the Chinese government has increased government health expenditures (GHE) significantly to address widespread complaints about health delivery
The two figures together provide some descriptive evidence that GHE appears to be positively correlated with budgetary deficits, a relationship further explored in the “Regression results” section
Summary
As a response to widespread complaints of growing inequality-related health problems, the Chinese government has initiated and implemented a series of policy changes since the mid-2000s. In early April 2009, the central government announced a massive expansion of its health provisions with the aim of providing basic health services to the whole population by 2020 (Chinese Communist Party and State Council 2009). This is an important milestone signifying the Chinese state’s determination to reverse the trend of deteriorating equity throughout the 1980s and 1990s. A range of efforts have been made to expand the coverage of health insurance schemes and improve the accessibility of health services
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