Medical care, Cost of

This thesis empirically analyzes the determinants of national health care expenditures in the United States and five other industrialized economies. A reduced-form model for national health care expenditures, based upon a partial-adjustment mechanism, is specified as a function of supply and demand factors in interrelated markets in the medical sector and estimated for the United States for the period 1960 to 1990. A pooled model is also estimated for a cross-section of six industrialized economies based upon time series data from 1976 to 1990 for each country. The results suggest that income, technological change, and inflation have a significant impact on national health care expenditures.