Private household spends income on goods and services according to either constant difference expenditure (CDE) specification or linear expenditure system (LES) specification of the expenditure function.
Roberts [60] argued that possible reasons for different estimates of income elasticity of health expenditure include: model specifications (e.g., cross-sectional vs panel; and static vs dynamic); variable selections; and treatments for the unobserved heterogeneity across countries.
Seed, early, and late stage investments in common law countries are least sensitive to changes in R&D expenditures across model specifications.
Barro [15] sets up an endogenous growth model with the flow specification of government expenditure.
To examine the determinants of health expenditure, we propose a panel data specification as follows: Hexp_{it}=beta_{0}+beta_{1}+gamma_{it}+gamma X_{it}+delta trend+alpha_{i}+epsilon_{it} (8).
Various specifications of the dependent variable (pharmaceutical expenditure) were used: total pharmaceutical expenditure, Per capita district pharmaceutical expenditure, pharmaceutical expenditure per district health facility and pharmaceutical expenditure per outpatient department visit.
This appears to be driven largely by the lower likelihood of reporting zero consultation expenditure (at p > 0.1 in the optimal model specification).
After testing quadratic and logarithmic specifications, both education and per capita household expenditure favoured a logarithmic transformation.
Participant NZ3's hospital was bulk-funded, which enabled flexibility in expenditure, and this allowed the participant to negotiate service specifications and costs directly with the hospital's management.
In the same specification when cointegration was checked among health care expenditure, income and life expectancy a total of 7 statistic in Pedroni [31, 32] and 2 among 4 statistic of Westerlund [35] was found to be statistically significant.
However, in the fixed effects specification, Medicaid intensity did not significantly impact operating expenditure indicating that the OLS results were due to time invariant hospital characteristics.
