Over the last two decades, the Peruvian government has made great efforts to improve access to health care by significantly augmenting the coverage of the non-contributory public health care system Seguro Integral de Salud (SIS). This expansion has a positive impact on welfare and public health indicators, as it limits the risk of catastrophic health-related costs for previously uninsured individuals and allows for the appropriate treatment of illnesses. However, it also entails some unintended consequences for informality, tax revenues, and GDP, since a few formal agents are paying for a service that the majority of (informal) agents receive for free. In this paper, we use a general equilibrium model calibrated for Peru to simulate the expansion of SIS to quantify the unintended effects. We find that overall welfare increases, but informality rises by 2.7 percent, while tax revenues and output decrease by roughly 0.1 percent. Given the extent of the expansion in eligibility, the economic relevance of these results seems negligible. However, this occurs because the expansion of coverage was mostly funded by reducing the spending per-insured person. In fact, we find larger costs if public spending is increased to improve the quality of service given universal coverage.
Mr. David Coady, Mr. Benedict J. Clements, and Mr. Sanjeev Gupta
Using cross-country analysis and case studies, this book provides new insights and potential policy responses for the key fiscal policy challenges that both advanced and emerging economies will be facing.
This technical note analyzes the health care spending issues in advanced economies. Both public and total health spending have increased substantially in advanced countries. Total health spending increased by more than 6 percentage points of GDP in the Organization for Economic Cooperation and Development countries between 1970 and 2007. This note examines the recent trends in health care spending in advanced countries. It discusses the main challenges for advanced countries over the medium term. Policy options for containing health care costs are also described.
This 2010 Article IV Consultation discusses Czech Republic’s economic condition. The Czech economy’s fundamentals were strong prior to the global economic and financial crisis. However, owing to its highly open nature, the economy was hit by spillover effects. A downturn in the euro area depressed exports while investment declined owing to a drop in FDI and the tightening of banks’ lending standards. Monetary and fiscal easing provided helpful stimulus, thereby cushioning the economic downturn.
This primer explains why macroeconomists need to be concerned with issues of health policy and elaborates the essential information that a macroeconomist should know in providing inputs to discussions on health sector policy. The primer illustrates how these issues and the range of appropriate policy options may differ depending on the state of development of an economy and the particular approach taken by a country in structuring its health system. The primer also highlights the appropriate roles for the state and market in health care financing and provision, taking account of the various sources of market failure in the health sector.
This primer aims to provide IMF macroeconomists with the essential information they need to address issues concerning health sector policy, particularly when they have significant macroeconomic implications. Such issues can also affect equity and growth and are fundamental to any strategy of poverty reduction. The primer highlights the appropriate roles for the state and market in health care financing and provision. It also suggests situations in which macroeconomists should engage health sector specialists in policy formulation exercises. Finally, it reviews the different health policy issues that confront countries at alternative stages of economic development and the range of appropriate policy options.
Belgium has effected a remarkable fiscal adjustment, best illustrated by the decline in its public debt. While benefiting from an appreciable decline in interest rates, most of the underlying consolidation reflected a considerable increase in the tax burden, one of the highest in the Organisation for Economic Cooperation and Development. This paper analyzes the social transfer system in Belgium. Belgium has a very accessible and equitable health care system. The system is characterized by high input levels and service volumes.
This Selected Issues paper examines Germany’s growth record in 1992–2001 and analyzes how future performance might be enhanced. The paper focuses on the longer-term strains on the public finances. It reviews Germany’s external competitiveness, which deteriorated substantially in the wake of unification, and concludes that, by the beginning of the current decade, competitiveness had been largely restored. The paper also examines the recent slowdown in credit, which has gone beyond what might be expected on cyclical grounds.
This Selected Issues paper highlights that over the past decade, the Netherlands has undergone a remarkable fiscal adjustment, with the deficit, the tax burden, and the expenditure-to-GDP ratio falling significantly. The switch from a deficit-target-based to an expenditure-target-based fiscal framework in 1994 and commitments to two successive four-year fiscal plans have played an important role. The current multiyear framework expires in 2002, and the Study Group on the Budgetary Margin has produced recommendations for the coming government period.
The IMF Working Papers series is designed to make IMF staff research available to a wide audience. Almost 300 Working Papers are released each year, covering a wide range of theoretical and analytical topics, including balance of payments, monetary and fiscal issues, global liquidity, and national and international economic developments.