Is the quest for efficiency harmful to health equity? An examination of the health efficiency-equity nexus in OECD countries over the past two decades

Marwân-Al-Qays Bousmah (), Mohammad Abu-Zaineh (), Simon Jean-Baptiste Combes () and Bruno Ventelou ()
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Marwân-Al-Qays Bousmah: INED - Institut national d'études démographiques, Ceped - UMR 196 - Centre Population et Développement - IRD - Institut de Recherche pour le Développement - INSERM - Institut National de la Santé et de la Recherche Médicale - UPCité - Université Paris Cité - Université Sorbonne Paris Nord, IC Migrations - Institut Convergences Migrations - French Collaborative Institute on Migration [Aubervilliers]
Mohammad Abu-Zaineh: AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique, Doha Institute for Graduate Studies
Simon Jean-Baptiste Combes: UCL - University College of London [London]
Bruno Ventelou: AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique

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Abstract: Background: Has the quest for efficiency in OECD health systems impacted the social gradient of health? We examined the cross-dynamics of the health system equity-efficiency nexus among OECD countries in the past two decades. Methods: We used a three-step methodology based on annual macro-level data from 36 OECD countries for the period 2004–2021. First, we estimated the efficiency of health systems using a stochastic frontier analysis. We then assessed the equity of health systems using simple measures of income-related inequality in self-assessed health. Lastly, we estimated the dynamic relationship between health system efficiency and equity using a panel Granger causality analysis. We also stratified the analysis by type of health system: viz. publicly- vs. privately-dominated health service provision. Findings: We find evidence for a bidirectional causality between health system efficiency and equity. An increase in health system efficiency leads to an increase in socioeconomic inequalities in health; a result particularly salient in countries with predominantly private health service provision. Interestingly, decreases in socio-economic inequalities in health are likely to lead to higher health system efficiency, especially in countries where the health system relies predominantly on public provision. Interpretation: The pursuit of efficiency gains in OECD health systems has not been a precondition for socioeconomic equity in health. Adverse effects of efficiency-seeking interventions on health equity are particularly apparent in the private provision of healthcare. However, addressing health inequalities provides a plausible route to enhance efficiency.

Keywords: Reverse causality; Granger causality; Stochastic frontier analysis; Health system; Equity-efficiency tradeoff (search for similar items in EconPapers)
Date: 2025-10
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Published in Social Science & Medicine, 2025, 383, pp.118379. ⟨10.1016/j.socscimed.2025.118379⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05235233

DOI: 10.1016/j.socscimed.2025.118379

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