Research Brief
Testing the Connection Between Social Spending and Better Health: U.S. Edition
May 25, 2016
Previous studies have shown that social spending is associated with better health outcomes in OECD countries. This exploratory study builds on this finding by widening the scope of the analysis, by incorporating other societal factors — namely, social capital and income inequality — and by assessing these relationships not only at the cross-national level but also at the cross-state level within the United States.
A cross-national empirical analysis of social expenditure and population health measures
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Previous studies have shown that social spending and the ratio of social to health spending are associated with better health outcomes in OECD countries. This exploratory study builds on this finding by widening the scope of the analysis, by incorporating other societal factors — namely, social capital and income inequality — and by assessing these relationships not only at the cross-national level but also at the cross-state level within the United States.
The findings of the study are based on analyses of large longitudinal cross-national data sets on social spending, health outcomes and wider societal factors.
The study confirmed earlier findings of a positive association between higher social spending and improved health outcomes, even when this is tested in many different ways. Public social expenditure by governments seems to have a particularly strong relationship with health outcomes. Disaggregating social spending by type of programme, some areas of social expenditure, such as old-age spending, appear more strongly positively related to better health outcomes than others. In addition, better health outcomes seem to be even more evident when the data are looked at over a longer time period from when the social expenditure occurs — perhaps because social expenditure can take time to translate into better health outcomes.
Wider contextual factors also appear to matter. Countries with higher levels of trust in others tend to have both higher levels of social spending and better health outcomes. Also, higher inequality is associated with an even stronger association between social spending and health outcomes.
Chapter One
Introduction: The American health paradox
Chapter Two
A cross-national comparison: What is the relationship between social spending and health outcomes?
Chapter Three
Do wider contextual factors play a role in the relationship between social expenditure and health?
Chapter Four
Do the same relationships hold within the United States?
Chapter Five
What do the results mean? Summary of findings and concluding discussion
Appendix A
Detailed description of analytical models
Appendix B
Technical details on social expenditure and SOCX data
Appendix C
Technical details on selection of health indicators
Appendix D
Additional model results
Appendix E
Variation in health outcomes within the United States
Appendix F
Relationship between social capital and health
The research described in this report was conducted by RAND Europe.
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