The effects of medical factors on transfer deficits in Public Assistance in Japan: a quantile regression analysis
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The effects of medical factors on transfer deficits in Public Assistance in Japan: a quantile regression analysis Masayoshi Hayashi
Received: 6 April 2010 / Accepted: 29 August 2011 / Published online: 14 September 2011 © Springer Science+Business Media, LLC 2011
Abstract In countries where local governments are heavily involved in financing health care for the indigent, regional disparities in local revenues may adversely affect the access of the poor to medical care. It is thus important to examine how central governments provide funds for such local medical needs. In Japan, local governments finance all medical costs for the poor through their Public Assistance (PA) programs. Using the unique mechanism of the Japanese system of central grants, I construct a measure of “transfer deficit” which shows the portion of the PA expenditures that fails to be secured by the central grants. The distribution of such a measure provides important information to assess the regional equity in financing local programs. The results suggest a compromise on the regional equity in financing medical care for the indigent. Then, I explore the determinants of the deficit measure by performing a quantile regression analysis. Since no effects of potential determinants imply that the central grants well accommodate changes in local needs, finding such effects helps evaluate the performance of the transfer system. The results shows that, among others, the number of PA households and the factors related to mental illness of PA recipients have positive impacts that attenuate toward the top of the conditional quantile of the transfer deficit. I elaborate on plausible causes of such attenuating responses. Keywords
Public Assistance · Transfer deficits · Medical factors · Japan
JEL Classification
H75 · H71
Introduction Financing health care for the poor remains an important policy issue in many economies. The issue varies across countries according to their institutions and policy contexts (France 2008). In countries where sub-national governments are heavily involved in financing health care for the indigent, one of the important issues is designing the system of central grants. Without M. Hayashi (B) Graduate School of Economics, The University of Tokyo, Hongo 7-3-1, Bunkyo-ku, Tokyo 113-0033, Japan e-mail: [email protected]
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central grants, regional disparities in fiscal resources adversely affect individual access to medical care. However, trends toward decentralization and reforms in central grants in many countries have raised concerns for regional equity in health care finance, prompting a growing number of studies to investigate the issue.1 While these studies used statistical techniques that utilize sub-national expenditure data, they could have also approached the issue by examining the institutional aspects of central grant systems. However, doing so is not always feasible.2 In contrast, such an examination may be feasible in Japan where local governments finance medical care for the indigent as Medi
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