Background
Methods
Model structure
Data
Year | 1995 | 2014 | 1995 | 2014 | 1995 | 2014 | |
---|---|---|---|---|---|---|---|
Variables | Obs | Mean | Mean | Std.Dev | Std.Dev | Max | Max |
HE | 161 | 443.4 | 1202.5 | 819.8 | 1971.8 | 4308.5 | 9673.5 |
LFE | 161 | 54.5 | 61.7 | 12.2 | 10.6 | 73.5 | 76.7 |
U5MR | 161 | 64.5 | 30.9 | 65.2 | 32.6 | 279.5 | 162.2 |
IMR | 161 | 43.7 | 23.2 | 37.4 | 21.8 | 153.4 | 98.8 |
MMR | 160 | 277.9 | 157.8 | 403.1 | 227.2 | 2900 | 1410 |
Estimation strategy
Cross-section dependence and heterogeneity in panel data
Panel unit root tests
Panel cointegration tests
Panel granger causality tests
Diagnostic tests
Results
Panel unit root tests
Cross-sectional Augmented IPS (CIPS*) (Trend) | ||||||||||
Dep.Variables HE | IMR | MMR | U5MR | LFE | ||||||
Income Groups | Level | 1st Diff | Level | 1st Diff | Level | 1st Diff | Level | 1st Diff | Level | 1st Diff |
GL | −2.13 | − 3.74* | − 2.42 | − 3.31* | − 2.54 | − 4.26* | − 2.65 | − 2.88* | − 2.95* | − 3.83* |
LY | − 2.70 | − 4.27* | −2.38 | − 2.72* | − 1.90 | − 3.33* | −2.04 | − 2.71* | −2.85* | − 2.77* |
LM | −2.44 | − 3.44* | − 2.53 | −2.98* | − 2.09 | − 3.16* | − 3.23* | 3.86* | − 3.11* | − 3.98* |
HM | − 2.52 | − 3.54* | − 2.12 | −2.95* | − 2.36 | − 4.42* | −2.17 | − 2.96* | − 3.98* | − 4.13* |
HY | − 1.49 | − 2.94* | −2.02 | − 3.09* | 2.75* | − 5.12* | − 2.21 | − 3.02* | − 2.73* | − 4.42* |
Harris–Tsavalis (HT) (Trend) | ||||||||||
Dep. Variables HE | IMR | MMR | U5MR | LFE | ||||||
Income Groups | Level | 1st Diff | Level | 1st Diff | Level | 1st Diff | Level | 1st Diff | Level | 1st Diff |
GL | 5.51 | −16.51* | 8.52 | − 5.42* | 12.34 | 9.13+ | − 12.27* | −41.78* | 13.98 | 6.05+ |
LY | 1.07 | − 13.35* | 0.61 | − 14.90* | 6.02 | 5.22+ | −13.20* | − 27.22* | 8.87 | 6.69+ |
LM | 4.17 | −12.82* | 7.12 | 5.54+ | 5.71 | −5.79* | 6.09 | −7.17* | 12.12 | 10.27+ |
HM | 2.97 | −10.25* | 5.34 | 3.62+ | 5.92 | −3.88* | 5.93 | 3.29 | 1.68 | −4.33* |
HY | 3.23 | −10.26* | 6.99 | −5.16* | − 0.66 | − 15.58* | 6.88 | 5.92 | 4.37 | −7.24* |
Cross-sectional Augmented IPS (CIPS*) (Constant) | ||||||||||
Dep. Variables HE | IMR | MMR | U5MR | LFE | ||||||
Income Groups | Level | 1st Diff | Level | 1st Diff | Level | 1st Diff | Level | 1st Diff | Level | 1st Diff |
GL | −2.20* | −3.69* | −2.47* | − 2.53* | −2.42* | −3.68* | − 2.78* | −2.45* | − 2.12 | −3.17* |
LY | −3.16* | −4.37* | −2.78* | − 2.45* | −1.36 | −2.50* | − 2.39* | 2.31* | − 3.33* | − 2.88* |
LM | − 2.82* | −3.79* | − 2.44* | −2.32* | − 2.09 | −3.17* | − 3.23* | −2.51* | −1.14 | −3.10* |
HM | −3.25* | −3.57* | −2.30* | --2.61* | −2.63* | −3.80* | −2.42* | −1.81 | −1.87 | −4.18* |
HY | −1.83 | −3.41* | −2.03* | −3.10* | −2.75* | −4.63* | − 2.32* | − 3.02* | −2.38* | − 4.23* |
Harris–Tsavalis (HT) (Constant) | ||||||||||
Dep. Variables HE | IMR | MMR | U5MR | LFE | ||||||
Income Groups | Level | 1st Diff | Level | 1st Diff | Level | 1st Diff | Level | 1st Diff | Level | 1st Diff |
GL | 11.05 | −54.82* | 10.16 | −64.33* | 9.35 | −27.68* | 6.72 | −98.98* | 12.27 | −27.33* |
LY | 2.51 | −16.51* | 8.51 | −5.41* | 9.34 | −27.68* | 6.72 | −98.97* | 6.88 | −30.25* |
LM | 4.17 | −12.82* | 7.21 | −6.35* | 3.83 | −32.64* | 5.27 | −27.17* | 7.08 | 1.13+ |
HM | 2.87 | −10.16* | 5.27 | 3.57+ | 1.51 | −5.46* | 5.01 | −7.91* | 6.20 | −34.49* |
HY | 11.05 | −54.82* | 10.16 | −64.32* | 9.34 | −27.68* | 6.72 | −98.97* | 11.00 | −27.33* |
Panel cointegration test
Dep.Variables | IMR | MMR | U5MR | LFE | ||||
---|---|---|---|---|---|---|---|---|
Income Groups |
Long
|
Short
|
Long
|
Short
|
Long
|
Short
|
Long
|
Short
|
LY | −0.22* (0.04) | − 0.01* (0.01) | 0.48* (0.14) | − 0.11 (0.08) | 0.03* (0.04) | − 0.03 (0.02) | − 0.01* (0.25) | − 0.21* (0.03) |
LM | − 0.01 (0.03) | −0.04* (0.01) | − 0.02 (0.04) | −0.26* (0.09) | − 0.01 (0.04) | −0.07* (0.16) | 0.013* (0.08) | −0.44* (0.05) |
HM | 0.124* (0.02) | −0.02* (0.07) | 0.05* (0.28) | 0.01 (0.08) | 0.07* (0.04) | −0.03 (0.05) | 0.04* (0.00) | − 0.51* (0.09) |
HY | 0.00* (0.00) | −0.08* (0.14) | −0.01* (0.00) | − 0.08* (0.05) | 0.00* (0.00) | −0.09 (0.15) | 0.00* (0.00) | −1.15* (0.11) |
Dep. Variables | IMR | MMR | U5MR | LFE | ||||
---|---|---|---|---|---|---|---|---|
Income Groups |
Coef.
|
SE
|
Coef.
|
SE
|
Coef.
|
SE
|
Coef.
|
SE
|
GL | −0.003* | 0.000 | −0.024* | 0.004 | −0.004* | 0.001 | 0.092* | 0.006 |
LY | −0.005* | 0.001 | 0.059 | 0.306 | −0.080* | 0.047 | 0.930* | 0.180 |
LM | −0.025* | 0.003 | 0.034 | 0.028 | −0.040* | 0.004 | 0.523* | 0.085 |
HM | − 0.005* | 0.001 | −0.100* | 0.017 | −0.006* | 0.002 | 0.209* | 0.020 |
HY | −0.002* | 0.001 | − 0.036* | 0.011 | −0.000* | 0.000 | 0.014* | 0.003 |
Granger causality test
Granger causality test | DH non-causality approach | TY non-causality approach | ||||
HE to IMR | IMR to HE | HE to IMR | IMR to HE | HE to IMR | IMR to HE | |
Z-value
|
Z-value
|
Z-value
|
Z-value
|
Z-value
|
Z-value
| |
GL | 2.91 | 14.37* | 9.29* | 10.31* | 6.69 | 7.32 |
LY | 7.77* | 0.43 | 3.19* | 5.97* | 4.57* | 12.31* |
LM | 4.25 | 14.10* | 3.02* | 3.06* | 5.79* | 1.94 |
HM | 2.88 | 1.92 | 1.54 | 1.65* | 1.74 | 6.01 |
HY | 22.57* | 30.64* | 4.02* | 1.22 | 12.21* | 5.79 |
Granger causality test | DH non-causality approach | TY non-causality approach | ||||
HE to MMR | MMR to HE | HE to MMR | MMR to HE | HE to MMR | MMR to HE | |
Z-value
|
Z-value
|
Z-value
|
Z-value
|
Z-value
|
Z-value
| |
GL | 5.76 | 10.67* | 3.65* | 4.01* | 4.12 | 3.35 |
LY | 0.20 | 1.07 | −1.64 | 1.20 | 9.43* | 1.95 |
LM | 2.34 | 0.46 | 0.11 | −0.84 | 5.29 | 5.89 |
HM | 0.91 | 0.54 | −0.24 | − 0.12 | 5.39 | 0.01 |
HY | 2.85* | 0.56 | −0.97 | 1.78* | 1.87 | 6.37 |
Granger causality test | DH non-causality approach | TY non-causality approach | ||||
HE to U5MR | U5MR to HE | HE to U5MR | U5MR to HE | HE to U5MR | U5MR to HE | |
Z-value
|
Z-value
|
Z-value
|
Z-value
|
Z-value
|
Z-value
| |
GL | 7.97* | 22.07* | 9.26* | 12.06* | 5.52 | 5.02 |
LY | 12.61* | 0.55 | 4.51* | 5.115* | 10.19* | 13.75* |
LM | 8.19* | 1.49 | 4.36* | 6.62* | 1.67 | 1.65 |
HM | 0.82 | 0.23 | 1.02 | 1.103 | 2.88 | 5.98 |
HY | 35.58* | 26.51* | 3.82* | 2.001* | 3.27 | 3.44 |
Granger causality test | DH non-causality approach | TY non-causality approach | ||||
HE to LFE | LFE to HE | HE to LFE | LFE to HE | HE to LFE | LFE to HE | |
Z-value
|
Z-value
|
Z-value
|
Z-value
|
Z-value
|
Z-value
| |
GL | 11.85* | 14.33* | 16.30* | 22.60* | 52.21* | 24.92* |
LY | 0.59 | 0.21 | 2.73* | 31.17* | 2.85 | 4.02 |
LM | 2.30 | 0.28 | 2.18* | 10.13* | 5.2 | 14.04* |
HM | 1.32 | 0.56 | 1.78 | 37.38* | 10.46 | 13.42* |
HY | 0.00 | 1.28 | 13.25* | 19.62* | 33.34* | 5.21 |
Diagnostic tests
Wooldridge test for autocorrelation | ||||||||
---|---|---|---|---|---|---|---|---|
HE -IMR | HE-MMR | HE –U5MR | HE-LFE | |||||
Z-value
|
p-value
|
Z-value
|
p-value
|
Z-value
|
p-value
|
Z-value
|
p-value
| |
GL | 2.54 |
0.113
| 0.84 |
0.359
| 3.76 |
0.054
| 27.97 |
0.000
|
LY | 7.12 |
0.067
| 4.92 |
0.073
| 3.36 |
0.075
| 62.56 |
0.000
|
LM | 1.39 |
0.243
| 1.46 |
0.232
| 5.16 |
0.068
| 1.13 |
0.293
|
HM | 2.54 |
0.112
| 0.845 |
0.359
| 3.75 |
0.054
| 0.392 |
0.532
|
HY | 3.74 |
0.056
| 0.092 |
0.763
| 12.76 |
0.081
| 15.89 |
0.000
|
Pesaran CD test | Modified Wald heteroscedasticity test | |||||||
HE to IMR HE-MMR | HE –U5MR HE-LFE | HE to IMR HE-MMR | HE –U5MR HE-LFE | |||||
Z-value
|
Z-value
|
Z-value
|
Z-value
|
p-value
|
p-value
|
p-value
|
p-value
| |
GL | 0.45* | 0.25* | 0.48* | 0.86* | 0.000 | 0.000 | 0.000 | 0.000 |
LY | 0.45* | 0.37* | 0.43* | 0.54 | 0.000 | 0.000 | 0.000 | 0.000 |
LM | 0.54* | 0.29* | 0.56* | 0.89* | 0.000 | 0.000 | 0.000 | 0.000 |
HM | 0.46* | 0.23* | 0.49* | 0.26* | 0.000 | 0.000 | 0.000 | 0.000 |
HY | 0.41* | 0.72* | 0.45* | 0.68* | 0.000 | 0.000 | 0.000 | 0.000 |
Residual Normality test | ||||||||
Skewness | Kurtosis | |||||||
p-value
|
p-value
| |||||||
IMR- HE | 0.273 | 0.167 | ||||||
MMR-HE | 0.095 | 0.205 | ||||||
U5MR-HE | 0.774 | 0.165 | ||||||
LFE-HE | 0.756 | 0.002 |
Impulse response and variance decomposition tests
Variance decomposition | Impulse variable health expenditure | ||||||
---|---|---|---|---|---|---|---|
LY | Response variables | LM | Response variables | ||||
Period |
IMR
|
MMR
|
U5MR
| Period |
IMR
|
MMR
|
U5MR
|
0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
2 | 0.1516875 | 0.0168 | 0.083523 | 2 | 0.019212 | 0.006631 | 0.062427 |
4 | 0.1717245 | 0.0408 | 0.083659 | 4 | 0.022824 | 0.016638 | 0.06754 |
6 | 0.172093 | 0.0508 | 0.083663 | 6 | 0.02724 | 0.020663 | 0.068715 |
8 | 0.1720995 | 0.005505 | 0.083663 | 8 | 0.030114 | 0.022065 | 0.068956 |
10 | 0.1721 | 0.0057 | 0.083663 | 10 | 0.031903 | 0.02254 | 0.069006 |
12 | 0.1721 | 0.005795 | 0.083663 | 12 | 0.033052 | 0.0227 | 0.069017 |
HM |
Response variables
| HY |
Response variables
| ||||
Period |
IMR
|
MMR
|
U5MR
| Period |
IMR
|
MMR
|
U5MR
|
0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
2 | 0.0094175 | 0.008848 | 0.014273 | 2 | 1.69E-05 | 0.003191 | 0.12657 |
4 | 0.083379 | 0.011133 | 0.046812 | 2 | 0.041963 | 0.019582 | 0.161816 |
6 | 0.102849 | 0.011687 | 0.057516 | 2 | 0.061122 | 0.030531 | 0.213393 |
8 | 0.1067585 | 0.01194 | 0.062043 | 8 | 0.074016 | 0.047492 | 0.227842 |
10 | 0.1075825 | 0.012068 | 0.064321 | 10 | 0.082359 | 0.061703 | 0.232503 |
12 | 0.1077575 | 0.012136 | 0.065539 | 12 | 0.087124 | 0.07372 | 0.23381 |
Robustness to alternative specifications
Discussion
Conclusions
Acknowledgements
Authors name | Date |
---|---|
Rezwanul Hasan Rana | 09/06/2018 |
Associate Prof. Khorshed Alam | 09/06/2018 |
Prof. Jeff Gow | 09/06/2018 |