A Time-Series Investigation of the U.S. Real Health Expenditure

Evidence from Nonlinear Unit Root Tests

Research output: Contribution to journalArticle

Abstract

This paper contributes to the literature on health expenditure studies by applying the non-linear unit root tests formulated recently by Kapetanios et al. (Journal of Econometrics 112(2):359-79, 2003) to empirically test whether the U. S. real health expenditure time-series are non-stationary or non-linear and globally stationary during a relatively long period from 1965 to 2009. For comparison purposes, it also reports the results of a battery of traditional linear unit root tests and the Lee and Strazicich's minimum LM unit root (Review of Economics and Statistics 85(4):1082-1089, 2003) test for structural breaks. The empirical findings of the paper show that in the United States during the period under investigation, the real health expenditure time-series are non-stationary in levels. Policy implications of the empirical findings are discussed.

Original languageEnglish
Pages (from-to)429-438
Number of pages10
JournalInternational Advances in Economic Research
Volume18
Issue number4
DOIs
StatePublished - Dec 2012

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Unit root tests
Health expenditures
Unit root
Statistics
Structural breaks
Econometrics
Policy implications
Long period
Economics

All Science Journal Classification (ASJC) codes

  • Economics, Econometrics and Finance(all)
  • Economics and Econometrics

Cite this

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