Increase In Public Expenditure Research Articles

Clinical and cost effectiveness of services for early diagnosis and intervention in dementia

This paper analyses the costs and benefits of commissioning memory services for early diagnosis and intervention for dementia. A model was developed to examine potential public and private savings associated with delayed admissions to care homes in England as a result of the commissioning of memory services. The new services would cost around pound sterling 220 million extra per year nationally in England. The estimated savings if 10% of care home admissions were prevented would by year 10 be around pound sterling 120 million in public expenditure (social care) and pound sterling 125 million in private expenditure (service users and their families), a total of pound sterling 245 million. Under a 20% reduction, the annual cost would within around 6 years be offset by the savings to public funds alone. In 10 years all people with dementia will have had the chance to be seen by the new services. A gain of between 0.01 and 0.02 QALYs per person year would be sufficient to render the service cost-effective (in terms of positive net present value). These relatively small improvements seem very likely to be achievable. These analyses suggest that the service need only achieve a modest increase in average quality of life of people with dementia, plus a 10% diversion of people with dementia from residential care, to be cost-effective. The net increase in public expenditure would then, on the assumptions discussed and from a societal perspective, be justified by the expected benefits. This modelling presents for debate support for the development of nationwide services for the early identification and treatment of dementia in terms of quality of life and overall cost-effectiveness.

Military Expenditure, Spending Capacity and Budget Constraint in Eighteenth-Century Spain and Britain

ABSTRACTUsing new public spending statistics for Spain and other various indicators we show that Spain and Britain suffered larger increases in public expenditure in the periods in which they fought each other and other countries. The British Exchequer spent much more than its Spanish counterpart, especially on the Army and Navy and debt repayment. This situation helps to explain why Britain emerged victorious against Spain in the majority of these wars and was a consequence of the political and institutional changes made in England from 1688 onwards, reducing budget constraint and allowing Britain to mobilise the necessary resources to become the leading world power. In Spain, however, the changes required to eliminate the country's history of bankruptcies and increase its spending capacity were not made.

Does Quality of Work Life Affect Men and Women’s Retirement Planning Differently?

Population ageing in most western countries involves an increase in public expenditures and the risk of labour shortage. One way to meet these challenges is to retain older workers in the labour market by improving their work life. This article assesses whether quality of work life measures differ in importance for male and female workers in their retirement planning. This study applies samples of workers and retirees born in 1940 and 1945 drawn from Danish panel surveys in 1997 and 2002 and merged with longitudinal register data. Results suggest that male and female workers’ retirement plans are affected differently by various aspects of the job. Indeed, job demands lower planned retirement age, while increases in earnings, work hour satisfaction, and the opportunity to use skills on the job increase this age for men and women. Nevertheless, the impact of earnings is largest for men, and only male workers attach importance to job control and job security. These gender differences suggest, first, that men are more influenced than women by the quality of job dimensions in their retirement planning and, second, that an employer-initiated effort directed towards retaining older workers at the workplace will not necessarily be as effective for female as for male workers.

Projecting Pension Expenditure in Spain: On Uncertainty, Communication and Transparency

In this paper we suggest a set of indicators about the future performance of the Spanish public pension system and a suitable method of representing their uncertainty, in order to improve the communication to the public opinion about its main future challenges. Spain seems a particularly interesting case in Europe to illustrate our proposals, since the social security system has been in surplus for nine consecutive years, in sharp contrast to the projections made just a decade ago, but, at the same time, most projections foresee for Spain one of the highest increases in public expenditure among EU countries due to ageing. We argue that simple, transparent, credible, public and periodic indicators, which take explicitly into account the uncertainty about future demographic, economic and institutional developments, may contribute to improve the debate on the policies needed to strengthen the pension system.

Costs and determinants of privately financed home-based health care in Ontario, Canada

The Canadian context in which home-based healthcare services are delivered is characterised by limited resources and escalating healthcare costs. As a result, a financing shift has occurred, whereby care recipients receive a mixture of publicly and privately financed home-based services. Although ensuring that care recipients receive efficient and equitable care is crucial, a limited understanding of the economic outcomes and determinants of privately financed services exists. The purposes of this study were (i) to determine costs incurred by families and the healthcare system; (ii) to assess the determinants of privately financed home-based care; and (iii) to identify whether public and private expenditures are complements or substitutes. Two hundred and fifty-eight short-term clients (<90 days of service utilisation) and 256 continuing care clients (>90 days of utilisation) were recruited from six regions across the province of Ontario, Canada, from November 2003 to August 2004. Participants were interviewed by telephone once a week for 4 weeks and asked to provide information about time and monetary costs of care, activities of daily living (ADL), and chronic conditions. The mean total cost of care for a 4-week period was $7670.67 (in 2004 Canadian dollars), with the overwhelming majority of these costs (75%) associated with private expenditures. Higher age, ADL impairment, being female, and a having four or more chronic conditions predicted higher private expenditures. While private and public expenditures were complementary, private expenditures were somewhat inelastic to changes in public expenditures. A 10% increase in public expenditures was associated with a 6% increase in private expenditures. A greater appreciation of the financing of home-based care is necessary for practitioners, health managers and policy decision-makers to ensure that critical issues such as inequalities in access to care and financial burden on care recipients and families are addressed.

Learning from health system reforms: lessons from Burkina Faso

Burkina Faso has implemented a macroeconomic adjustment programme (MAP) along with an ambitious reform of the health care system. Our aim was (1) to verify whether MAPs led to a reduction in health resources, and (2) to analyze the consequences of health policies implemented. Cross-sectional and retrospective study, spanning the years 1983-2003. The macro aspect is based upon documents from national and international sources, a database of secondary socioeconomic data, and interviews of key informants working in upper management. Household and health facility surveys were conducted in three regions covering 53 communities. Within the reforms, the health sector benefited from an important flow of resources. There were significant increases in public expenditures, health care staff, the number of primary care facilities and the availability of generic drugs. However, health facilities in the public sector remain underused and major inequities subsist. Access to health care is constrained by the population's ability to pay. Health expenditures impoverish households, creating new poor and impoverishing the already poor. The success of reforms depends largely on the extent to which they remove financial barriers to access to services. The experience of Burkina Faso also reveals the need for fundamental changes that will motivate staff, improve productivity, and ensure good quality services. Integrating health development policies with strategic plans for poverty reduction can provide new opportunities for African countries to redesign their health systems within this type of perspective.

The Impact of Second Homes on Local Taxes*

AbstractA methodology to estimate the influence of second homes on municipal taxes is developed in this paper. Assuming that a larger floating population implies an increase in public expenditure, our aim is to develop a model of the relationship between the local taxes paid and the number of second dwellings in a village. As an applied example, the results for two of the most touristy regions of the Mediterranean – the Costa del Sol and the Costa Blanca, in Spain – are shown in this paper. As we will see, there are only three different levels of local taxes, regardless of the number of second homes. The main factors behind high local tax burdens are seaside location and the presence of foreign owners.

A Catastrophe Foretold: Economic Reform, Crisis, Recovery and Employment in Argentina

The economic crisis of 2001-2002 in Argentina caused a large increase in unemployment. Policy responses have been imperfect. This paper discusses the roots and character of the crisis, the policies implemented to address the resulting social situation, and the quality of early warning indicators available at the time of the crisis. The main cause of the crisis was the rapid increase of public expenditure, public indebtedness and debt servicing in the late 1990s, and the failure to reverse it when a new administration took office in December 1999. These fiscal developments prompted a large increase in the rate of interest the country had to pay in international markets, and eventually capital flight and a sudden stop of international financing both for the government and the private sector. The government announced it will stop servicing public debt, imposed capital controls and scrapped the currency system, causing a deep fall in economic activity, a sharp increase in inflation (40.9 in 2002, about 90% from 2002 to 2006) and a big increase in unemployment during 2002 and early 2003, until a recovery went underway. Some interpretations of the crisis have linked it to the monetary system (of the currency board type) the country had adopted in 1991 after several bouts of hyperinflation also linked with excessive public indebtedness and fiscal deficit. An examination of the arguments for this interpretation shows them lacking as an explanation of why the crisis occurred, though in the event of a crisis already happening a more flexible monetary system would have been helpful. The main responses to the social impact of the crisis have involved: - A large workfare program, which at its peak covered about 14% of total labour force - A freeze on utility charges (electricity, gas, fuel, telephones and others), further straining relations with the private firms running public services - A stiff cut in public debt to bondholders (i.e. except debt to international organizations), accepted by ¾ of bondholders so far. This, and obtaining a primary budget surplus, enabled the government to engineer a recovery and accumulate foreign currency reserves while preserving its ability to pay for social programs. Lack of early warning was not a factor in the crisis. Argentina has a good and well developed statistical system, and there was no dearth of indicators and early warning signals about this crisis. Even if improvements might be implemented in the main indicators available, they were enough to ascertain the probability of the crisis, and its impact. The main problems with forecasting and avoiding the crisis lay in poor governance, conflicting views about the country's position, different interpretations of the signals, and inability to respond through policy. Some of these problems are still present, and may have effects in the future.

¿Es la financiación sanitaria suficiente y adecuada?

Introduction The object of this short paper is to present the results of Spanish public health care expenditures projections until 2013 according to the expected impact of the main demographic and technological health cost drivers. Matherial and methods Future annual health expenditures are estimated using a simple method based on the decomposition of the past main growth factors in two scenarios. The main cost drivers considered were the following: demography, which includes the increasing number of people and the impact of population ageing; the increase in the price of health care inputs above the general price level; and the impact of changes in medical practice related with expanding medical technology. Results and discussion In 2013, public health care expenditure may be around 5.7% and 6% of gross domestic product (GDP); that is, at least, between 0.24 and 0.53 additional GDP points will be spent on public health care. The main factor responsible for the future expenditure increase will continue to be the increase in the average health service intensity, followed by demographic factors. In the base-case scenario, public expenditure increase until 2013 will be compatible with a real 2.5% annual increase in consumption of non-health goods and services. In order to finance the future costs, the Spanish population will have to devote to public health expenditure less than 7% of income increase until 2013. Conclusion and perspectives Despite being important, the expected Spanish GDP growth until 2013 may be enough to finance the increase in public health expenditure as a result of the impact of demographic changes. Expanding medical technology is expected to continue being the main driver of future costs.

The Effects of Cost-Shifting in the State Children’s Heath Insurance Program

Many states are increasing the State Children's Health Insurance Program (SCHIP) cost-sharing requirements to induce reductions in enrollment. We examined the effect of increasing SCHIP premiums on both health care use and cost to the public. The net cost to the public of increased cost sharing for SCHIP-insured children in a border community was estimated with multivariate methods. The majority (88%) of children were of Mexican origin. We estimated that a $10 increase in monthly premiums would induce 10% of SCHIP children to disenroll, resulting in a 6% increase in public expenditures. Families that disenroll from SCHIP and become uninsured typically turn to emergency departments for primary care, which increases total health care expenditures through the use of more expensive services.

Economic and Political Factors that Lead to the Budget Deficit in Hong Kong from 1998 to 2003

Despite the adverse impact of the budget deficit in Hong Kong has been alleviated since the economic recovery from 2003, the fiscal deficit may return when there is another downturn in the economy if the problem is not handled fundamentally. Based on the economic and political situation from 1998 to 2003, the factors that lead to the budget deficit in Hong Kong are analyzed in four perspectives, including (a) increase in public expenditure; (b) decrease in public revenues; (c) poor management of public money and (d) weak administration. With a better understanding on these factors, possible solutions to the fiscal problem faced by the government may be developed.

The Effects of Poor Financial Information Systems on the Long Term Sustainability of Local Public Services. Empirical Evidence from the Catalan Municipalities

In this paper we describe the existence of financial illusion in public accounting and we comment on its effects for the future sustainability of local public services. We relate these features to the lack of incentives amongst public managers for improving the financial reporting and thus management of public assets. Financial illusion pays off for politicians and managers since it allows for larger public expenditure increases and managerial slack, these being arguments in their utility functions. This preference is strengthen by the short time perspective of politically appointed public managers. Both factors run against public accountability. This hypothesis is tested for Spain by using an unique sample. We take data from around forty Catalan local authorities with population above 20,000 for the financial years 199398. We build this data basis from the Catalan Auditing Office Reports in a way that it can be linked to some other local social and economic variables in order to test our assumptions. The results confirm that there is a statistical relationship between the financial illusion index (FI as constructed in the paper) and higher current expenditure. This reflects on important overruns and increases of the delay in paying suppliers, as well as on a higher difficulties to face capital finance. Mechanisms for FI creation have to do among other factors, with delays in paying suppliers (and thereafter higher future financial costs per unit of service), no adequate provision for bad debts and lack of appropriate capital funding either for reposition or for new equipments. For this, it is crucial to monitor the way in which capital transfers are accounted in local public sheet balances. As a result, for most of the Municipalities we analy se, the funds for guaranteeing continuity and sustainability of public services provision are today at risk. Given managerial incentives at present in public institutions, we conclude that public regulation recently enforced for assuring better information systems in local public management may not be enough to change the current state of affairs

Inverted U-shaped fertility dynamics, the poverty trap and growth

This paper shows that the fertility rate increases at low income levels but decreases at high income levels, using a model that incorporates the trade-off between the quantity and quality of children. We also show that the increase in public expenditure for basic education may lower the risk of the economy converging to a poverty trap.

Causal relationships between public expenditure, public receipts and gross domestic product: Greece 1965-95

This paper applies the well-known Granger causality approach to investigate the causal relationships between (a) Greek public expenditure and Gross Domestic Product and (b) Greek public expenditure and public receipts. The results suggest that an increase in public expenditure does not lead to an increase in GDP; and that an increase in public expenditure does lead to an increase in public receipts. These results imply that in terms of output growth, the fiscal policy applied in the late 1970s and the 1980s was rather ineffective; and the correction of the existing fiscal imbalances is conditional upon a reduction in public expenditure rather than an increase in public receipts. From that point of view, the effectiveness of the currently applied fiscal strategy is questionable.

Political Context and Program Evaluation: The Inextricable Link

Abstract: Program evaluations have assumed a much greater importance as pressure on public expenditure increases. This article eschews evaluation designs that are politically vacuous by drawing attention to the importance of contextual variables in a case study of a community relations program based in Northern Ireland. The research illustrates the dilemma now faced by evaluators in the United Kingdom. The demands of short-term, context-stripped, value-for-money evaluations are often in conflict with context-bound qualitative enquiries that can uncover the unique mix of social, political, and cultural influences on program delivery. The dominance of macro-political variables are illustrated as one example of a unique mix within this program.

La nouvelle version de MIMOSA, modèle de l'économie mondiale

Mimosa, a macroeconomic model of the world economy, jointly built by the CEPII and the OFCE, is now reestimated. This article presents its main features and describes some monetary and fiscal multipliers. The economies of the six bigger industrialised countries are described in great detail by neo-keynesian models : a five product disaggregation distinguishes the energy sector, agriculture, the non-traded sector, the government sector and the industrial sector for which a putty-clay production function ensures compatibilities between employment, investment and production capacity behaviour. These models allow a precise analysis of the consequences of many kinds of monetary or fiscal policies. The rest of the world is divided into twelve zones, more succinctly modelled : the model reveals in particular the financing constraints which bear on the imports of the less developed countries. International trade is analysed through a four product disaggregation. The article shows the model's properties while describing the impacts, in the country and abroad, of an increase in public expenditure in one of the major countries. It studies the consequences of worlwide increase in public expenditures, the implications of a worldwide increase in interest rates, and finally the effects of a decline in the dollar exchange rate.

Fiskalpolitik in einer Wechselkursunion. Bietet das Mundell-Fleming-Modell einen geeigneten Analyserahmen? / Fiscal Policy in an Exchange Rate Union. Does the Mundell-Fleming Model offer an Appropriate Analytical Framework?

Zusammenfassung Im vorliegenden Beitrag wird gezeigt, daß im MFM sowohl die internationale Verflechtung der monetären Sektoren als auch die Verbindung des monetären und realen Bereichs inkonsistent modelliert werden. Es liegt die Vermutung nahe, daß die Wirkungsweise wirtschaftspolitischer Maßnahmen anders ausfällt, wenn diese Inkonsistenzen beseitigt werden. Einen Vorschlag für eine korrekte Verbindung zwischen dem monetären und realen Sektor einer geschlossenen Volkswirtschaft liefern z.B. J. Tobin und B. Buiter (1980). Eine Alternative zum MFM könnte darin bestehen, diesen Ansatz um Außenhandelsbeziehungen und Kapitalbewegungen zu erweitern.

TERRITORIAL PUBLIC EXPENDITURE IN THE UNITED KINGDOM

Although the devolution plans of the 1970s were abandoned, those debates had far‐reaching consequences for the determination of relative public expenditure levels in the United Kingdom. The Barnett formula (10:5:85) of 1978 provided that increases in public expenditure in Scotland and in Wales for specific services within the territorial blocks would be determined according to the formula consequences of changes in equivalent English expenditure. A parallel formula allocated 2.75 per cent of the change in equivalent expenditure in Great Britain to Northern Ireland. The essential distinction is between base expenditure (whose current levels are carried forward) and incremental expenditure (which is determined by formula). The predicted convergence of block expenditure relatives on the LJK per capita average was frustrated by formula bypass, and in Scotland by relative population decline. The background to the 1992 recalibration of the Barnett formula (10.66:6.02100.00 and Northern Ireland 2.87 per cent) is analysed. Territorial block expenditure is set within the structure of territorial public expenditure aggregates, and evidence is assembled on identifiable public expenditure relatives between countries and by English region.

Financing of health care for the elderly in Japan: a history of piecemeal revision and lack of long-term solution

The reform of health care financing in Japan is done piecemeal because the public has an ambivalent attitude towards paying for health care. So, the Japanese method to the problems of escalating health care costs is one of “revisionism”. The only drastic change was the increase in public expenditures under the “Gold Plan”. Systematic revision will not be made until the next century.

Opting into State Control? Headteachers and the Paradoxes of Grant‐maintained Status

ABSTRACT This paper reflects on the significance of two paradoxes of opting out within which grant‐maintained (GM) school headteachers are entangled, and to which they contribute. Discussion of the first paradox focusses on the way GM status, rather than eliminating ‘producer interests’, creates a new one in the form of headteacher control which assists the policy's implementation and the realisation of other educational reforms. Examination of the second addresses the government's willingness to offer an expensive financial subsidy to GM schools when one of its aims is to demonstrate that the administrative and managerial efficiencies that accrue from opting out can improve the quality of education provision in ways that do not entail any increase in public expenditure on schools. The paper suggests that the government is happy to give preferential financial treatment to GM schools because it regards opting out as a necessary condition for increasing its control of state education. It also argues that, w...