Distributional analysis of rural-urban household healthcare expenditure differentials in developing countries: evidence from Ghana

Abstract

Purpose Equity in access to and use of healthcare resources is a global development agenda. Policymakers’ knowledge of the sources of differences in household healthcare spending is crucial for effective policy. This paper aims to investigate the differences in the determinants of household healthcare expenditure across space and along selected quantiles of healthcare expenditure in Ghana. The determinants of rural-urban healthcare expenditure gap are also explored. Design/methodology/approach Data was obtained from the sixth round of the Ghana Living Standards Survey (GLSS 6) conducted in 2013. An unconditional quantile regression (UQR) and a decomposition technique based on UQR, adjusted for sample selection bias, were applied. Findings The results indicate that differences in the determinants of household healthcare expenditure across space and along quantiles are driven by individual-level variables. Besides, the rural-urban health expenditure gap is greatest among households in the lower quantiles and this gap is largely driven by differences in household income per capita and percentage of household members enrolled on health insurance policies. Originality/value The findings show that there are differences in the determinants of household health expenditure along with the income distribution, as well as between rural and urban localities, which would call for targeted policies to address these inequalities.