Munich Personal RePEc Archive

Household Health Expenditure in Greece and the Impact of Financial Crisis

Zikidou, Stavroula and Hadjidema, Stamatina (2020): Household Health Expenditure in Greece and the Impact of Financial Crisis.


Download (2MB) | Preview


The aim of this paper is to investigate, through economic science tools, the impact of economic downturn and Memorandum health policies, under the hypothesis that Household Health Expenditure (HHE) was increased. Apart from that, a secondary objective is to interpret the Greeks behavior of consumption towards health services over time. In this context, by using multiple regression analysis on the raw micro-data of Greek Household Budget Surveys of 1987, 1994, 1999, 2004, 2008, 2009, 2010, 2011, 2012, 2013, 2014, 2015, 2016, 2017 and 2018, in the STATA vs 13, we examined the differentiation to the level of private health spending, as regards households sociological characteristics and to what extent private spending could be foreseen/ affected by some characteristics of the population, as well as by financial crisis. Analysis demonstrated that households over time had less income and thus, because of the inelasticity of demand for Health, they spent greater proportion of their income for health. The results, also, showed a rise in the proportion of spending on drugs, therapeutic devices, equipment and hospital care and reduction on medical services expenditure. Regarding the determinants of demand, i.e. the socio-economic characteristics, we examined the age of the household in charge, the place of residence and the household type/ synthesis. The findings showed that households in urban areas spend more money on health compared to households in rural areas, over time. In particular, households in rural areas spend more money on drugs, therapeutic appliances and equipment than households in urban areas, while households in urban areas spend more on medical services and hospital care compared to households in rural areas. The analysis of data regarding the age of the household in charge showed that the average total HHE was reduced regardless of the age of the household in charge. Over time, the ages that appear to spend a higher proportion of their income on health are those over 65 years. Moreover, it was observed, as is logical, that the higher the age group of the household in charge, the higher the total health expenditure over time. Furthermore, age increase is associated with higher monthly costs for medicines, therapeutic appliances and equipment. It should also be noted that the average monthly expenditure on medicines, therapeutic appliances and equipment in each age group were stable during the crisis with a slight upward trend. Consequently, over the years of financial crisis, the monthly HHEs are reduced due to the confiscation of revenue the middle class suffered by, which reduced their consumption ability. Bearing in mind that larger proportion of their shrinking income is now spent for health (since, healthcare is inelastic commodity and hence difficult to be “restrained”), HHE, as a percentage of total private spending, is consequently increased, in line with the hypothesis hereof, namely that “during the economic recession and implementation of the fiscal adjustment measures in Greece, Greek household health spending was increased”.

MPRA is a RePEc service hosted by
the Munich University Library in Germany.