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The ageing of society, health services provision and taxes

Abstract

This paper investigates the outcome of ageing on taxes and hospitalisation of the elderly using panel data on 23 Swedish county councils 1980–1999. We test two hypotheses; whether a larger share of elderly has no negative effect on bed days per elderly person and no positive effect on tax rates. We reject the first hypothesis but fail to reject the second hypothesis. Further we cannot reject the hypothesis of a unitary elasticity of the share of elderly on bed days per elderly person. These results imply that the old bear the entire cost of adjustment when the population grows older.

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Correspondence to Ulf-G. Gerdtham.

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We thank Sölve Elmståhl and two anonymous referees, for helpful comments and suggestions. The financial support from the Swedish National Institute of Public Health to Gerdtham is gratefully acknowledged and the financial support from the Swedish Research Council to Saez-Marti is also gratefully acknowledged.

Responsible editor: Deborah Cobb-Clark.

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Gerdtham, UG., Lundin, D. & Sáez-Martí, M. The ageing of society, health services provision and taxes. J Popul Econ 18, 519–537 (2005). https://doi.org/10.1007/s00148-005-0223-8

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  • DOI: https://doi.org/10.1007/s00148-005-0223-8

JEL classification

  • H1
  • I10
  • C23

Keywords

  • Health care
  • panel data
  • ageing
  • voting