The Case for Public Financing of Environmental Common Goods for Health

Figures & data

TABLE 1. Key Terms

Term	Definition
Planetary health	The health of human civilization and the natural systems on which it depends
Environment	The congregation of all the physical, chemical, and biological factors external to a person and all related behaviors. It excludes natural environments that cannot be modified and behavior not related to the environment, as well as that related to the social and cultural environment, genetics and parts of the natural environment.^Citation1
Ecosystem services	The benefits provided to humans through the transformation of resources (or environmental assets including land, water, vegetation, and atmosphere) into a flow of essential goods and services, e.g., clean air, water, and sustainable food.^Citation2
Environmental common goods for health (CGH)	Environmental policies and interventions that have significant impacts on human health and require collective financing from the government (or donors) based on a clear economic rationale for interventions due to the market failures of (a) public goods (non-rival and non-exclusionary) or (b) large social externalities.^Citation3

FIGURE 1. Harmful Effects of Environmental Change and Ecosystem Impairment on Human Health

Source: Adapted from Refs. 14 and 15

FIGURE 2. Burden of Disease from Environmental Risks by Disease Category, 2002 and 2012

Source: Reproduced from Ref. 5

TABLE 2. Environmental Protection and Health Expenditure Relationships

Dependent Variable: Per capita public health expenditure ^(a)	Coefficient estimate (robust standard errors)
Model ^(b)	A1	A1-IV	A2-IV	A3	A3-IV
GDP p.c. PPP (ln) ^(a,c)	1.2*** (0.11)	1.5* (0.65)	1.6*** (0.48)	0.90*** (0.045)	0.95*** (0.082)
Gov Exp. on Env. Protection in p.c. (ln)	0.034 (0.018)	0.0034 (0.041)
EPI-Ecosystem Vitality (0–100 index)	−0.0086*** (0.0031)	−0.0093*** (0.0031)	−0.095*** (0.0031)	−0.0041 (0.0028)	−0.0047 (0.0030)
Size of government (Gov. Exp as % of GDP)	0.017*** (0.0035)	0.020** (0.0073)	0.020*** (0.0061)	0.0088*** (0.0024)	0.0088*** (0.0024)
Private share in health spending (% current)	−0.014*** (0.0016)	−0.014*** (0.0013)	−0.014*** (0.0014)	−0.024*** (0.0029)	−0.024*** (0.0030)
Population over 65 (% of total population)	0.023** (0.0089)	0.015 (0.010)	0.014 (0.010)	0.059*** (0.0094)	0.058*** (0.011)
Country size in square km (ln)	0.035 (0.031)	0.069 (0.088)	0.073 (0.080)	0.014 (0.016)	0.013 (0.016)
Time trend (year)	0.031*** (0.0031)	0.028*** (0.011)	0.027** (0.0090)	0.024*** (0.0024)	0.023*** (0.0028)
N.B. Constant terms, including regional effect (WHO regions), not reported
	Regression statistics
Number of countries	22	22	22	159	158
Years (unbalanced)	2000-2013	2000-2013	2000-2015	2000-2015	2000-2015
Observations (over full period)	200	200	200	2,356	2,340
R-squared—within	0.92	0.91	0.91	0.78	0.78
R-squared—between	0.96	0.94	0.94	0.96	0.96
R-squared—overall	0.96	0.94	0.93	0.95	0.95
Chi-squared (Wald Test)	2,311***	2,140***	1,845***	5,242***	4,886***

* p < .05; ** p < .01; *** p < .001

^aAll monetary values are measured in constant purchasing power parity (PPP). Public expenditure on health per capita includes both domestic and foreign public funding of current expenditure (GHED, based on SHA 2011).

^bAll models were estimated using panel data random effects methods. IV indicates that a two-stage instrumental variable procedure is used. Hausman tests validate the consistency of the random effects model.³⁴ Durbin-WU-Hausman augmented regression tests reveal some endogeneity issues with the GDP variable in all models; other variables do not create bias; Davidson-MacKinnon-Hausman tests indicate that the instrumental variable estimation effectively removes all endogeneity bias (see Table A1.6 in supplemental material).³⁵

^cThe SDG index (annual scaled value from IHME²⁸) is used as instrument for GDP.

Source: Authors using STATA 15 statistical package; data from Refs. 23–28

TABLE 3. Country-Level Determinants of Policy-Related Environmental Performance

		Dependent variable (0–100 indices, higher is better)
		Environmental Health			Ecosystem Vitality
Model ^(a)		Env. Health Outcomes B1: ENVH	PM2.5 performance B2: AIR		Biodiversity & Habitat B3: BDH	Climate & Energy B4: CCE ^(b)	Air Pollution NOx & SO2 B5: APE^(b)
GDP p.c. in constant PPP (ln)^(c)		10.1** (3.2)	3.2 (12)		6.6 (14)	11.7** (4.5)	5.1 (8.2)
Governance index (factor)		6.3* (2.5)	−6.8 (5.6)		−1.5 (8.0)	−5.2 (3.6)	−3.3 (6.4)
Politics index (factor)		−2.3 (1.6)	5.2** (1.7)		6.6** (2.2)	−2.1 (2.4)	−2.8 (3.2)
Government stability index		−4.3** (1.5)	−1.2 (1.4)		−3.0* (1.4)	2.1 (2.1)	2.2 (2.8)
Urban share of population (%)		0.25** (0.089)	−0.011 (0.29)		−0.082 (0.33)	−0.34* (0.14)	−0.058 (0.21)
Population over 65 (% share) ^(d)		1.5*** (0.39)
Total population (ln)			−4.6* (2.1)		0.40 (2.4)	1.4 (1.1)	3.6* (1.6)
Country size (ln)		−1.1* (0.48)	1.3 (1.3)		0.91 (2.3)	−1.6 (0.98)	−1.6 (1.6)
Time trend ^(e)		1.4** (0.50)	−1.5 (1.4)		0.91 (1.6)	1.1 (2.0)	−0.78 (2.4)
N.B. Constant terms including regional effect (WHO regions) not reported
Regression Statistics
Number of countries	131		131		128	130	130
Number of time periods^(e)	4		4		4	2	2
Observations	322		322		317	230	230
R-squared—within	0.66		0.15		0.14	0.02	0.05
R-squared—between	0.85		0.37		0.27	0.30	0.29
R-squared—overall	0.86		0.38		0.21	0.20	0.25
Chi-squared (Wald Test)	1,039***		90***		112***	68***	56***

* p < .05; ** p < .01; *** p < .001; robust standard errors in parentheses

^aAll models are estimated using panel data random effects estimation combined with instrumental variables methods. Hausman tests validate the consistency of the random effects model.³⁴ Durbin-WU-Hausman augmented regression tests reveal some endogeneity issues with the GDP variable in all models; other variables do not create bias; Davidson-MacKinnon-Hausman tests indicate that the instrumental variable estimation effectively removes all endogeneity bias (see Table A1.6 in supplemental material).³⁵

^bIndicators used to construct the climate and air pollution indices are calculated from predicted values given GDP level so the impact of GDP is not expected to be statistically significant by construction.²³

^cThe share of population over 65 is expected to affect health outcomes (ENVH), not environmental performance.

^dThe adult literacy rate from UIS²⁹ is used as instrument for the log of GDP.

^eThe data is collapsed into 4 periods (2000/4; 2005/9; 2010/4; 2015/7) to reduce measurement errors. For CCE and APE, we only have baseline and current values so the number of periods is reduced to 2 (2000/9; 2010/7).

Source: Authors using Stata 15 statistical package; data from Refs. 23 and 25–31

TABLE 4. Environmental CGH

Category	Notable Common Goods for Health	Possible responsible institutions/ sectors
Policy and coordination	Setting national standards, policies and targets for air quality based on WHO guidelines for air quality	Health, Environment
	Setting national standards, policies and targets for water, sanitation and wastewater services, based on risk assessment and management approaches recommended in WHO Guidelines	Health, Environment, Water, Sanitation
	Establishment of legal frameworks for regulatory institutions	Health
	Build/adapt climate-resilient health facilities including greening of the health sector	Health, Environment, Water, Sanitation, Energy
	Establishment of national and local urban mobility policies	Transport, Urban Development, Local Government
	Setting of national urban and housing policies, and regional and city master plans	Urban Development, Local Government, Housing
	Emergency response to chemical, radiation emergencies	Health, Environment, Energy
	National occupational health and safety frameworks and programs	Health, Labor
Taxes and subsidies	Subsidies for the use of clean fuels in households	Finance
	Sanitation subsidies for poorest households	Finance
	Pro-poor water tariffs	Finance
	Carbon taxes	Finance
	Subsidies for public transport access and bicycle acquisition and use	Transport, Local Government, Finance
	Taxation for the acquisition and use of private vehicle (e.g. cars and motorcycles)	Transport, Local Government, Finance
	Land-use taxation (e.g. on parking space; low emission zones)	Urban Development, Local Government, Finance
	Subsidies for built environment and land-use	Urban Development, Local Government, Finance
	Tax on telecommunication operators to fund health research (e.g. on exposure to radiofrequency fields)	Telecommunications
Regulations	Air quality standards	Health, Environment
	Implementation of international conventions	National government
	Regulation on the use of safe cooking and heating equipment and modern energy fuels	Environment, Energy
	Energy efficiency standards	Environment, Energy
	Regulation of service quality and affordability for water, sanitation and wastewater services (includes establishment, monitoring and enforcement of water quality standards)	Health, Environment, Water, Sanitation, Energy
	Safe management of chemicals (including industrial chemicals, pesticides, and consumer products)	Health, Environment, Agriculture, Industry
	Industrial effluent control (water)	Environment
	Occupational and environmental noise control regulation	Environment, Transport, Local Government, Labor
	Regulation for occupational health and safety	Health, Labor
	Regulation of land-use and built environment (e.g. zoning; open streets programs; off-hour deliveries; building codes)	Urban Development, Local Government
	Safe management of radiation (public, workers, patients)	Health, Energy, Environment, Labor, Radiation protection regulators
Information and Analytics	Health promotion (multi-modal approaches to stimulate behavior change in communities, schools, health care facilities, workplaces etc.)	Health, other relevant sectors
	Environmental health surveillance and monitoring of major risks to health (zoonoses, chemicals, radiation, air, water and wastewater, solid wastes, occupational risks)	Health, other relevant sectors (Environment, Water, Sanitation, Energy, Labor)
	Public reporting on water quality parameters	Health, Water supply utilities, Regulators,
	Environmental change and health surveillance (health in climate change, biodiversity, desertification, ecosystems)	Health, Environment, Rio Conventions (UNFCCC, UNCCD, CBD), Montreal Protocol
	Country level environmental and occupational burden of disease assessments	Health
	Global environmental change burden of disease assessments	Health, WHO
	Information management system to track funding to water and sanitation	Health, Environment, Water, Sanitation, Finance, Statistics Office
	Monitoring the results chain, including inputs and processes, and outcomes	Health, Environment, Water, Sanitation, Finance, Statistics Office, Education
	Information management systems on air quality levels (pollutants concentrations, air quality indexes) and related health advice for the general and vulnerable populations	Health, Environment, Meteorological services
	Early warning systems for sand and dust episodes	Health, Meteorological services
	Health and Environmental Impact Assessment of plans, policies and interventions	Health, Environment, Local Government, Finance
	Health impacts of new technologies (e.g. 5G, nanotechnologies)	Global agencies
Population services	Provision of sustainable transport systems (with priority to walking, cycling, and clean and accessible public transport)	Local government, Transport
	Improved regional and urban planning and design (e.g. provision and access to green and open spaces)	Local government, Regional government
	Better energy options. Incentives to invest in renewable energy, insulation	Health, Environment, Energy
	Build community resilience to climate change	Health, Environment
	Vector control management	Health, Environment
	Medical waste management	Health, Environment, Local Government
	General waste management	Health, Environment, Local Government
	Coordinated risk management for water and sanitation services (through implementation of Water Safety Plans, and Sanitation Safety Planning)	Health, Environment, Water, Local Government
	Municipal solid waste management	Health, Environment, Local Government
	Promotion and protection of urban ecosystem services (e.g. biodiversity; biological control; habitat for species; pollination; food production; aesthetic appreciation; fresh water; erosion prevention and maintenance of soil fertility)	Health, Environment, Local Government

Source: Prepared in consultation with the Department of Public Health, Environmental and Social Determinants of Health, WHO

TABLE 5. Costs for Obtaining Environmental CGH in 67 Low- and Middle-Income Countries

	Total (Million USD, 2014)	Per Capita USD (Pop. weighted, 2014)
Water Quality Monitoring	184.94	0.033
Total LICs	12.19	0.020
Total LMICs	66.67	0.024
Total UMICs	106.09	0.046
Green Health Facilities	45,939.44	8.13
Total LICs	1,691.59	2.81
Total LMICs	20,051.14	7.27
Total UMICs	24,196.70	10.58
Clean Cooking Subsidies	81,881.01	14.50
Total LICs	13,012.16	21.59
Total LMICs	49,414.54	17.92
Total UMICs	19,454.31	8.51

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