What Drives Health-Care Spending in China? A Nationwide Decomposition Analysis

41 Pages Posted: 3 Dec 2020 Last revised: 22 Dec 2020

See all articles by Keyang Li

Keyang Li

University of International Business and Economics (UIBE) - School of International Trade and Economics

Yu Qin

National University of Singapore (NUS) - Department of Real Estate

Luwen Shi

Peking University - International Research Center for Medicinal Administration

Jing Wu

Tsinghua University - Hang Lung Center for Real Estate; Tsinghua University - Department of Construction Management

Date Written: October 15, 2020

Abstract

In this study, we explore the geographic variation in health-care spending and its driving factors in China, using a nationwide and claim-level sample of inpatients ensured under the urban basic medical insurance schemes in 2010. We show geographic variation in health-care spending is substantial in China and is significantly larger than Medicare spending in the US. The substantial geographic variation is primarily driven by the quantity variation. We also discuss the potential correlates of the quantity of health care at the city level. The findings imply possible allocation inefficiency in China’s current urban health-care system.

Keywords: Health-care Spending, Geographic Variation, Variance Decomposition

JEL Classification: I1, I11, I13

Suggested Citation

Li, Keyang and Qin, Yu and Shi, Luwen and Wu, Jing, What Drives Health-Care Spending in China? A Nationwide Decomposition Analysis (October 15, 2020). Available at SSRN: https://ssrn.com/abstract=3711857 or http://dx.doi.org/10.2139/ssrn.3711857

Keyang Li (Contact Author)

University of International Business and Economics (UIBE) - School of International Trade and Economics ( email )

10 East Huixin Street
Chaouang District
Beijing, 100029
China

Yu Qin

National University of Singapore (NUS) - Department of Real Estate ( email )

4 Architecture Drive
Singapore 117566
Singapore

Luwen Shi

Peking University - International Research Center for Medicinal Administration ( email )

Beijing
China

Jing Wu

Tsinghua University - Hang Lung Center for Real Estate ( email )

HeShanHeng Building
Beijing, 100084
China

HOME PAGE: http://thuwujing.net

Tsinghua University - Department of Construction Management ( email )

Heshanheng Building
Tsinghua University
Beijing, 100084
China

HOME PAGE: http://thuwujing.net

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