In 2006, the US spent approximately 15.8% of its GDP on health care, more than any other Organisation for Economic Co-operation and Development (OECD) country and considerably larger than the 9.1% average of the 23 other peer nations included in this study (OECD Health Data, 2009). The US also had the lowest female and male life expectancies at birth compared to the same 23 OECD nations (OECD Health Data, 2009). This raw and partial evidence suggests that the US health care system may be performing inefficiently. The purpose of my research is to assess the efficiency of the US health care system through a comparative analysis of 24 OECD countries, including the US, with similar per capita income levels over the period 1960 to 2008. I utilize a Cobb-Douglas production function regressed using both Ordinary Least Squares and Stochastic Frontier Analysis techniques in order to test the robustness of my results. My findings suggest that some of the apparent inefficiency of the US is actually due to lifestyle choices, though the US may still be performing inefficiently compared to some of its peers.
Economics | Other Economics | Public Economics
Clayton, Amanda C., "Assessing the Productive Efficiency of US Health Care: Comparison of Analytical Methods" (2010). Honors Projects. Paper 106.