Much of the work which has led to a widely held view that the income elasticity of health care spending exceeds one has been based on international cross-section data, or on pooled cross-sections and time series. In this paper we re-examine this view in the context of long-run equilibrium relationships between non-stationary time series, possibly including autonomous trends. Our results east doubt upon the usefulness of pooling and upon the notion of an elasticity above one.

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Keywords Cointegration, Health care expenditure, Income elasticity, Pooling
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Journal Journal of Health Economics
Blomqvist, Å, & Carter, R.A.L. (R. A.L.). (1997). Is health care really a luxury?. Journal of Health Economics, 16(2), 207–229. doi:10.1016/S0167-6296(96)00534-6