Abstract
This study examines the effect of environmental externalities on health expenditure, and identifies the determinants of health expenditure in a panel of 35 Asian countries for the period of 1995-2010. The study uses static panel data analysis. The results suggest that carbon monoxide emissions and particulate matter concentration (PM10) have a positive relationship with per capita health expenditure. Evidence also suggests that a change in health expenditure per capita in Asian countries is mainly explained by the change in population aged more than 65 years and above and country’s income affect the health expenditure allocation. The finding of this paper have important implication on the Asian countries policymakers in archiving the sustainability of national development especially on health related expenditure
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