Scandinavian Working Papers in Economics

SSE/EFI Working Paper Series in Economics and Finance,
Stockholm School of Economics

No 365: Equity in Swedish Health Care Reconsidered: New Results based on the Finite Mixture Model

Ulf-G. Gerdtham and Pravin K. Trivedi
Additional contact information
Ulf-G. Gerdtham: Dept. of Economics, Stockholm School of Economics, Postal: P.O. Box 6501, SE-113 83 Stockholm, Sweden
Pravin K. Trivedi: Department of Economics, Indiana University, Postal: Wylie Hall, Bloomington, IN 47405, U.S.A.

Abstract: This paper reconsiders the equity issue in Swedish health care utilisation previously analyzed by Gerdtham (Health Economics 6, 303-319, 1997) within the framework of the standard two-part model. Departing from the user/nonuser distinction, we use the more flexible framework of the finite mixture model that distinguishes between frequent/infrequent users. Our empirical results indicate that the finite mixture model fits the data better than the two-part model. The results indicate that income increases use among infrequent users in both physician and hospital care but that there is no such income effect among frequent users.

Keywords: Equity; health care; count data; latent class models; finite mixture models

JEL-codes: C20; C25; C52; I10; I18

21 pages, March 15, 2000

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