On the Chinese’ health expenditure: from Toda-Yamamoto to machine learning approach

ABSTRACT

This study aims to demonstrate, through an econometric and Machine Learning approach, the health expenditure-economic growth nexus in China over the period 1980–2017. Describing the situation of the Chinese health system through the economic literature, we apply different econometric tests. The Toda and Yamamoto approach is crucial in our analysis: It highlights the existence of a bidirectional causal flow, running from health expenditure renew to GDP per capita and vice versa. This scenario respects the economic growth theory and hypothesis. Finally, in order to validate our results, as required by scientific models, we chose to test the econometric results obtained through a D2C algorithm in Machine Learning. At present, there is no evidence of other studies using this kind of approach in order to explain the health expenditure-economic growth nexus in China over this period.

KEYWORDS:

• Health expenditure
• China
• Toda and Yamamoto
• machine learning

Credit author statement

Marco Mele: Data curation, Conceptualization, Methodology, Software, Supervision.

Luana Randazzo: Visualization, Investigation, Validation and Editing.

Declaration section

We wish to confirm that there are no known conflicts of interest associated with this publication; moreover, no significant financial support influenced this work and its outcome.

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Notes on contributors

Marco Mele

Marco Mele is an Adjunct Professor of Economic Policy at the Faculty of Political Sciences, University of Teramo, Italy. He received his Ph.D. in “Economics and Law in International Relations” and a Master’s Degree in “International Trade” organized by Roma Tre University. Moreover, he attended many specialization courses and summer schools in econometrics. He is a reviewer for many international journals and Editorial Board member for numerous economics journals.

Luana Randazzo

Luana Randazzo is a Ph.D. student in International Politics and Economics at the University of Teramo. Graduated with honours in Political Sciences and International Relations at the University of International Studies, Rome. Lecturer assistant in Political Sciences and International Organizations, and in International Economics. Reviewer for some international journals.