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UNITED STATES
THESIS
MASTER OF ARTS
in
ECONOMICS
at
SPRING
2011
DETERMINANTS OF THE INFANT MORTALITY RATE IN THE
UNITED STATES
A Thesis
by
Approved by:
Date: _____________________________
ii
Student: John Ross Costa
I certify that this student has met the requirements for format contained in the University
format manual, and that this thesis is suitable for shelving in the Library and credit is to
Department of Economics
iii
Abstract
of
by
John Costa
This thesis examines the relationship between infant mortality and several
variables that have been shown to affect it especially health spending. The study is based
on state level U.S. data between the years 1991 and 2004. This thesis is unique in its
examination by using the U.S. statistics. Previous research on the topic found that health
spending levels have either lowered the infant mortality rate or has had no statistical
significance. After controlling for state and time fixed effects as well as possible
endogeneity issues, this thesis found similar results for both outcomes. Other variables in
the regression also played a roll in the infant mortality rate and their following results are
also consistent with previous research. Higher levels of education and income were
shown to lower infant mortality rates. Higher total fertility rates, alcohol and cigarette
policies were also found to lower infant mortality, although this relationship is not
entirely clear.
iv
ACKNOWLEDGEMENTS
I would like to thank the following people that made it possible for me to succeed in
Professor Gallet for his clear vision for my thesis and his extensive input,
Professor Kaplan for all of his help, especially answering the countless number of
v
TABLE OF CONTENTS
Page
Acknowledgements..............................................................................................................v
Lists of Tables..................................................................................................................viii
Lists of Figures...................................................................................................................ix
Chapter
1. INTRODUCTION...................................................................................................1
2. LITERATURE REVIEW........................................................................................5
3.2 Data................................................................................................................22
4. ESTIMATION RESULTS.....................................................................................31
5. CONCLUSION.....................................................................................................47
vi
Page
References..........................................................................................................................50
vii
LIST OF TABLES
Page
1. Table 3.1. Descriptive Statistics 1991-2004.................................................................23
viii
LIST OF FIGURES
Page
1. Figure 3.1. Infant Mortality Rate..................................................................................24
2. Figure 3.2. Health Expenditure per capita by Resident................................................27
3. Figure 3.3. Health Expenditure per capita by Provider................................................27
4. Figure 3.4. Medicare Expenditure per enrollee............................................................28
5. Figure 3.5. Abortion Rate per 1,000 women age 15-44...............................................29
6. Figure 3.6. Teenage Birth Rate.....................................................................................30
ix
1
Chapter 1
INTRODUCTION
This thesis analyzes the determinants of the infant mortality rate in the United
States using state level panel data. The infant mortality variable is quantifiable and
widely used in the literature as an indicator of health outcomes. A key point of interest is
the impact of healthcare spending, measured by the location of the resident and by the
location of the provider, on infant mortality. Other variables are included as determinants
been increasing at a rate well above that of inflation. In addition, the share of GDP
indication of reversing course ("NHE fact sheet," 2010). Also, there is on-going political
and thus we seek to measure its impact on infant mortality, which is often used as a gauge
of overall health status. Yet since other developed countries spend less than the United
States on healthcare, while their infant mortality rate is more or less equivalent to that of
the United States (Cillizza, 2010), this suggests additional factors may also influence
infant mortality.
function, whereby independent variables determine the infant mortality rate (Cochrane,
Leger, & Moore, 1978). For instance, Crémieux, Ouellette, & Pilon (1999) and similar
2
studies found that infant mortality decreased with an increase in income, number of
doctors, and educational attainment. Also, infant mortality tended to increase with
increases in the poverty rate, cigarette consumption, alcohol consumption, and the
percentage of the population who are African Americans. Some studies have found a
negative relationship between healthcare spending and infant mortality (e.g., see
Crémieux, Ouellette, & Pilon, 1999; Crémieux et al., 2005), while others (e.g., Leu,
1986) fail to find a statistically significant relationship between the two variables. The
has only been explored in one study that focused on African nations (Anyanwu and
This thesis is different from prior studies in several ways. First, since this thesis
focuses on the impact of healthcare spending on the infant mortality rate within the
United States, it differs from much of the literature which has either focused on multiple
Canada). As Crémieux, Ouellette, & Pilon (1999) suggest, homogenous populations are
more likely to show a causal relationship between healthcare spending and infant
mortality, as diversity in the population has associated heterogeneity problems that more
likely render an outcome showing no relationship between healthcare spending and infant
mortality. Accordingly, this thesis addresses this issue using data from a quite diverse
population.
3
Second, prior studies examining the relationship between healthcare spending and
and infant mortality presents a causality issue in the sense that (i) spending more on
healthcare may reduce infant mortality, but (ii) higher infant mortality may induce greater
spending on healthcare.
The results of this thesis are consistent with prior studies. For instance, not only
do the models fit the data relatively well (i.e., R-square is reasonably high), but they
show in general that infant mortality decreases with increases in per capita income,
number of doctors, percentage of high school graduates, the abortion rate, and the
conservativeness of each state. Also, infant mortality tends to increase with an increase
in population density, the percentage of the population that smokes, per capita alcohol
consumption, the percentage of the population that is African American, and the
spending is shown to have a positive association with the infant mortality rate when the
relevant and exogenous. When the full set of instruments were used to predict healthcare
spending, this variable was not statistically significant in the infant mortality regression.
However, when some of the instruments were excluded, the healthcare spending variable
was found to have a negative association with infant mortality. Both of these results are
consistent with Leu's (1986) finding of no relationship between healthcare spending and
4
the infant mortality rate, as well as the Crémieux et al. (1999, 2005) finding of a negative
relationship.
literature and introduces the work of previous research, with an emphasis on the data and
methodologies used. Chapter 3 presents the four empirical models we estimate. This
chapter also presents and discusses the data used to estimate the regression models.
Chapter 4 presents the estimation results, which includes an investigation of the potential
summarizes the results, as well as discusses any shortcomings of the model and
Chapter 2
LITERATURE REVIEW
This chapter provides an overview of previous studies that, amongst other issues,
have examined the relationship between health spending and health outcomes. Although
the studies reviewed most commonly used infant mortality as a dependent variable in the
regressions that are estimated, they do differ in noticeable ways. For instance, not only
do studies differ in terms of empirical specification and data utilized, but they also
some studies are based on human capital theory, whereby individuals seek to maximize
utility (i.e., minimize infant mortality rates) subject to a budget constraint (e.g.,
Grossman, 1972). Alternatively, other studies model infant mortality in the context of a
determinants of infant mortality (e.g., Cochrane, Leger, & Moore, 1978). The focus of
this thesis is on the second approach as it is consistent with the empirical model to be
estimated.
One of the earliest studies to examine the determinants of infant mortality was by
Cochrane, Leger, & Moore (1978). In this study, although they did not consider the role
played by health spending, they did explore the relationship between age-specific
mortality rates and a number of regressors by utilizing data from 18 developed countries.
In the case of infant mortality, Cochrane, Leger, & Moore (1978) found increases in the
number of doctors, cigarette consumption, and alcohol consumption are associated with
higher infant mortality rates. They also found increases in income, population density,
6
and sugar consumption lower infant mortality. Although the signs of the coefficients of
many of the regressors are consistent with expectations, Cochrane, Leger, & Moore
(1978) fail to explain the unexpected signs of a few of the coefficients (i.e., one would
expect the coefficients of the number of doctors and sugar consumption to be opposite in
sign to their estimated values). Despite this setback, their paper provided a foundation
Similar to Cochrane, Leger, & Moore (1978), Hitiris and Posnett (1992) also
examined determinants of infant mortality. Specifically, using annual data for 20 OECD
countries over the 1960-87 period (i.e., 560 observations), Hitiris and Posnett estimated
income), age demographics, and infant mortality. In particular, initially they simply
considered the relationship between income and health expenditure, where they found a
strong positive relationship between the two (with an estimated elasticity of 1.026). In
their second model, they regressed health expenditure on the percentage of the population
age 65 and older, finding a positive relationship between these two variables as well.
Lastly, their third model showed that increases in health expenditure reduce the infant
mortality rate (although the associated elasticity of -0.08 suggests a relatively modest role
Eberstadt (1991) focused on the causes of infant mortality in the United States by
using similar techniques employed by Cochrane, Leger, & Moore (1978). Discounting
1
In addition, income and the percent of the population age 65 and older were found to
positively affect the infant mortality rate, with respective elasticities of 0.087 and 0.350.
In addition, all of these values are statistically significant.
7
the commonly held belief of the importance of poverty and medical care as the primary
determinants of infant mortality, Eberstadt (1991) argued that poor lifestyle choices on
the part of parents played a more significant role in determining infant mortality. Also,
Eberstadt (1991) also found that low birth weight is a leading indicator of infant
mortality, and accordingly he explored the determinants of low birth weight. He found
low birth weight is more likely to occur among African Americans and other minority
racial groups. In addition, he argued that smoking while pregnant (especially those who
smoke at least 15 cigarettes per day) and having a child out of wedlock are leading causes
included a series of tables based mostly on 1991 cross-sectional data from the U.S.
Department of Health and Human Services. Accordingly, because his study was based
on data from a single year, some of his assertions may be less relevant today. 3 Therefore,
2
In particular, Eberstadt found in the U.S. that those who live in poverty spend a smaller
percentage of their income on food compared to countries of Western Europe (i.e.,
France, Italy, and Norway), which explains much of the difference in the infant mortality
rate between the U.S. and these countries. Also, Eberstadt found that the mortality rate
between the 28th week of pregnancy and within 7 days of birth is lower in the United
States, suggesting that the quality of medical care is high in the U.S., and therefore it is
more likely that lifestyle and behavioral choices of parents are particularly important as
determinants of infant mortality.
3
For instance, it is much less likely that women today smoke 15 or more cigarettes per
day while pregnant.
8
series of regressions, thus allowing for both cross-sectional and time-series variation to
healthcare systems of 12 European countries to that of the United States to see the extent
unobservable lifestyle factors. Utilizing annual data from 12 (non-U.S.) OECD countries
over the 1960-87 period (183 observations), Grubaugh and Santerre considered the
following variables (all converted into logs) as determinants of infant mortality: number
of physicians per capita, income per capita, population density, per capita education
spending, female labor force participation rate, per capita alcohol spending, per capita
tobacco spending, a technology variable, and country fixed effects. Results were
promising, as evidence by the high R-square of 0.86 from this regression, as well as the
fact that most of the coefficients were of the expected sign and consistent with prior
findings. 4
Next, Grubaugh and Santerre (1994) utilized these regression results from non-
U.S. OECD countries to predict the U.S. infant mortality rate, which they found exceeded
the actual infant mortality rate for every year over the 1973-87 period. 5 Accordingly,
they argued the U.S. healthcare system is as good or perhaps better than other OECD
countries, all else equal. Nonetheless, when looking at the raw data, the fact that the U.S.
4
As an example, increases in per capita physicians and GDP were found to lower infant
mortality, while increases alcohol and tobacco spending were found to increase infant
mortality.
5
For instance, the average annual infant mortality rate in the U.S. over the 1973-87
period was 12.8 deaths per 1,000 births, whereas the model based on non-U.S. data
predicts an annual rate of 17.2 deaths per 1,000 births.
9
infant mortality rate tends to exceed that of other OECD countries led Grubaugh and
examined the relationship between healthcare spending and health outcomes, which they
relied on data across multiple countries, Crémieux et al. used annual Canadian province
level data over the 1978-92 period and found a statistically significant link between infant
Similar to Cochrane, Leger, & Moore (1978), Crémieux, Ouellette, & Pilon
(1999) estimated a "health" production function, whereby key inputs (e.g., healthcare
spending) are assumed to affect health outcomes (e.g., infant mortality). Incorporating
province-level fixed effects (but not time fixed effects), Crémieux, Ouellette, & Pilon
estimated both linear and double-log specifications using a generalized least squares
(GLS) procedure that corrected for both heteroskedasticity and autocorrelation. Their
findings showed that increases in per capita healthcare spending and the number of
6
According to Crémieux, Ouellette, & Pilon (1999), the reason for previous studies not
finding a statistically significant relationship between healthcare spending and health
outcomes has much to do with heterogeneity across countries. By limiting their study to
Canada, Crémieux, Ouellette, & Pilon argued heterogeneity is less of an issue. For
instance, relying on data from a relatively homogeneous population means such
unobservable factors as genetics play less of a role in determining differences in infant
mortality rates. Also, by relying on intra-national data there is less concern with
differences in the methods used to calculate the infant mortality rate, as well as the need
to construct currency-equivalent measures of various regressors. Lastly, although Canada
has a form of universal healthcare, there are nonetheless differences in healthcare
spending per capita across provinces and over time that can be used to explain changes in
health outcomes.
10
doctors reduced infant mortality rates. In particular, with respect to healthcare spending,
they found a 10 percent increase in healthcare spending reduced male (female) infant
mortality by 0.50 (0.40) percent. Moreover, they found that increases in the poverty rate,
fat consumption, and alcohol and tobacco consumption raised infant mortality rates.
However, per capita income was only found to affect female infant mortality rates in the
Crémieux, Ouellette, & Pilon (1999) also investigated elasticities between health
spending and health outcomes. They found that in general, a 10 percent increase in
health spending leads to a 0.5 percent decrease in infant mortality among males and a 0.4
percent decrease in infant mortality among females. The elastic values were less than one
and are shown to be in the inelastic range. Other studies have similar findings in terms of
an inelastic health spending and health outcome relationship (see Rigel, Hosek, Vollaard,
& Mahnovski, 2002). The inelastic relationship is due to general healthcare services
et al. (2001) analyzed annual data over the 1981-97 period across 9 U.S. geographic
7
In a follow-up study, Crémieux et al. (2005) explored the impact of Canadian
pharmaceutical spending on health outcomes. Similar to their 1999 study, they not
only used many of the same input variables as determinants of gender-specific
infant mortality, but they also used similar functional forms (i.e., linear and double-
log specifications), panel data corrections (i.e., province-level fixed effects), and
estimation methodology (i.e., generalized least squares). Their results showed that
increases in both pharmaceutical and non-pharmaceutical spending reduced infant
mortality rates.
11
Crémieux et al. also included region and time fixed effects, as well as variables
accounting for racial diversity (i.e., percent African American, percent Hispanic, and
percent other minority). Many of the results were similar to those of their Canadian
were found to decrease infant mortality. Furthermore, infant mortality rates were found
to increase with increases in minority populations (particularly Hispanic and other non-
African American minority groups), increases in low birth weight counts, increases in
teen pregnancy, and increases in the poverty rate. Yet the number of hospital beds and
high school graduates were not found to be statistically significant determinants of U.S.
infant mortality. Lastly, not only were the patterns of the coefficients of the time fixed
effects consistent with a downward trend in infant mortality, but the region fixed effects
coefficients suggested the Southwest (Northeast) region of the U.S. has a lower (higher)
Martin, Rice, & Smith (2008) examined the impact of healthcare spending on the
health of cancer and heart patients in the United Kingdom. This paper criticized studies
similar to those of Crémieux et al. (1999, 2001, 2005) for not accounting for potential
outcomes regressions. Utilizing recently compiled data from the National Institute for
Health and Clinical Excellence (NICE), Martin, Rice, & Smith (2008) used a two stage
spending. Comparing the ordinary least squares (OLS) and 2SLS results, Martin, Rice, &
Smith (2008) found that both estimation methods yielded a positive relationship between
data on rich and poor countries over the 1970-1995 period, a series of double-log
specifications were estimated, treating the infant mortality rate as a function of per capita
within a country, corruption, and political rights. One of their many findings showed that
fiscal decentralization led to lower infant mortality rates. They found that government
policies in which more control was given to the local government, as opposed to the
national government, led to more efficient resource allocation. Thus, a more efficient
resource allocation coincides with the adoption of policies that are better able to address
Nixon and Ulmann (2006) revisit the regression analyses of Crémieux (1999,
2001, 2005) by using many of the same regressors, but with international data from 16
OECD countries for the 1980-95 period. 8 To allow for a more flexible functional form,
a Box-Cox transformation was utilized. Their GLS results indicate that increases in
8
Variables used as determinants of infant mortality include healthcare expenditure,
healthcare expenditure as a percent of income, number of physicians per 10,000
residents, number of hospital beds per 1,000 residents, average length of hospital stay,
unemployment rate, alcohol consumption, tobacco consumption, nutritional consumption,
and pollution (i.e., sulfur dioxide exposure per resident per year).
13
physicians, and income per capita. 9 Results from this study showed a statistically
significant negative relationship between healthcare spending and infant mortality across
all four regression models. Also, higher female literacy rates were shown to lower
mortality rates. Yet all other variables were not found to be statistically significant at the
5 percent level.
Bauman and Anderson (1980) attempted to link a drop in infant mortality rates
with the legalization of abortion. They concentrated their analysis at the U.S. state level
data between the years 1967 and 1973 (note, abortion was legalized in 1973). The authors
examined the annual data for the change in the abortion to live birth ratio with the change
in the infant mortality rate for every combination of proceeding year subtracted by a
preceding year. They found that only the years between 1967 and 1969 showed a
statistically significant relationship between the abortion-birth ratio and the infant
mortality rate, which was also a time period when few legal abortions were performed.
Women between the ages of 15 and 19 also showed a few years where an increase in
9
Four different regressions were estimated. In the first, simple OLS was applied to the
model without any fixed effects. The second utilized a robust OLS procedure, while the
third included regional fixed effects. To control for potential endogeneity of healthcare
expenditure and income, the fourth applied an instrumental variables technique to the
model, with the instruments being military spending of bordering countries, the
consumption-investment ratio, and franc zone membership (a common currency shared
by several western and central African countries).
14
abortion-birth ratios led to lower infant mortality rates; however, the authors noted that
such results had low statistical significance. The most important finding of the article was
that there was no statistically significant relationship between the abortion-birth ratio and
the infant mortality rate between 1973 and any of the preceding years of the study. Thus,
Bauman and Anderson (1980) concluded that abortion does not have a strong impact on
In another study, Grossman and Jacobowitz (1981) explored public policies and
their impact on infant mortality in U.S. counties. Their study focused on women between
the ages of 15 and 49 and the neonatal infant mortality rate (i.e., deaths within the 27
days after birth). To control for race, African American infant mortality rates were also
included. The authors believed that state-level data could lead to heterogeneity problems,
and thus their study utilized county-level data. Counties with at least 50,000 individuals
were included in the general study and African Americans populations of at least 5,000
Their main finding was that abortion rates were the leading cause of lower infant
mortality rates since its legalization, which is a contradiction to the findings of Bauman
and Anderson (1980). This was observed by examining the seven-year time span before
abortion was legalized (1964-1971) and the six-year time span over much of which
abortion was legalized (1971-1977). Although 1973 was the year abortion was legalized
nationwide, 1971 was chosen as the cutoff year because Medicaid was rapidly increasing
after that year and was believed to also contribute to lower infant mortality rates.
Bauman and Anderson (1980) found that the six-year period after abortion was
legalized the infant mortality rate decreased at an increasing rate. For instance, the
decline in the infant mortality rate for whites throughout the entire 13 years was 4.9
percent in terms of the “annually compounded percentage rate.” However, this percent
was 3.2 percent in first seven-year period and 6.9 percent in the second six-year period.
Nonwhites also experienced an increased drop in the infant mortality rate. Their annual
compounded percentage rate throughout the entire 13 years was 4.6 percent, while during
the first seven-year period it was 4.4 percent, but 4.9 percent in their second six-year
period . This translates to a drop in infant mortality due to the legalization of abortions of
between 1.5 to 1.7 deaths per thousand births for whites and 2.5 deaths per thousand
Bauman and Anderson (1980), which found no relationship between abortion rates and
infant mortality in their study using U.S. state-level data. The reasons for this contrast,
according to Grossman and Jacobowitz, is that Bauman and Anderson do not take into
account other variables that affect infant mortality. Also, they do not subdivide infant
mortality by race. Lastly, their article did not explore policy changes that could affect
Besides the abortion rate, Grossman and Jacobowitz (1981) also found that
children born into poverty increase the infant mortality rate. In addition, the authors
found that increased educational attainment leads to lower infant mortality, a finding that
is similar to Crémieux et al. (1999 and 2001). One criticism readers could levy regarding
16
their findings was that Grossman and Jacobowitz exclusively use ordinary least squares
to estimate their regressions. Although the authors attempt to remedy the possible
regression problems of heterogeneity by using county-level data instead state level data,
it would have been better to explicitly use statistical methods to solve the problem.
Haas, Udvarhelyi, Morris, Carl, & Epstein (1993) examined the impact of infant
mortality rates from uninsured pregnant women after receiving healthcare coverage. In
1985, Massachusetts established the Healthy Start program, which allowed pregnant
women who were uninsured to receive health coverage if their income is less than 185%
of the poverty rate. Their paper examined the program as a natural experiment by
including data of single live births prior to the program (with the year 1984 and included
57, 257 observations) and after the implementation of the program (with the year 1987
The natural experiment measured the rate of medical care to patients before their
third trimester pregnancy and the rate of poor infant outcomes of those receiving
coverage under the Healthy Start program, or the treatment group. These rates are
compared to those in control groups from those on Medicaid and those with private
insurance. The results show that the overall access to prenatal care for all patients
declined during the 1984 and 1987 years from 96.4% to 93.8%. The percentage of poor
infant outcomes (6.6%) was unchanged for both years. Comparing the rates in
subcategories of the rates of prenatal care and poor infant outcomes among the treatment
group and the two control groups, the authors found that the difference in rates were not
17
statistically significant. Thus, the results show that Healthy Start did not change the rate
of those receiving prenatal care, nor did it change poor infant outcomes.
In the next chapter, we present the empirical model and data used to estimate the
model. As will be discussed, the empirical model accounts for many of the issues
Chapter 3
This chapter presents the empirical model and data for the regressions that are
estimated in this thesis. The equations to be estimated are comprehensive in that they
account for the various approaches taken by those studies discussed in the last chapter.
Using U.S. state-level panel data, we estimate four specifications which resemble
regressions estimated in other studies that have examined the impact of healthcare
following form:
Yit is the rate of infant mortality in state i during year t, Xit is a vector of regressors in
state i during year t, σi and τt represent state and time fixed effects, respectively, and uit is
an error term. 10
The dependent variable in all specifications is the number of infant deaths (one
year old or younger) per 1,000 live births (a standardized measure used in the literature),
which from here on out will be denoted as Infant Mortality. The first specification we
estimate (labeled regression 1), which serves as our baseline regression, includes the
(denoted as Residence Health Exp.), per capita gross state product (denoted as Income),
10
Across all specifications, we consider different panel data treatments. In particular,
initially we do not include any fixed effects, and then compare these results to
specifications that allow for (i) only state fixed effects, (ii) only time fixed effects, and
(iii) both state and time fixed effects.
19
the number of physicians per 100,000 in the population (denoted as Doctor), the percent
of the state population over the age of 25 who are high school graduates (denoted as High
School), the percent of the state population over the age of 25 who are college graduates
(denoted as College), the percent of the state population who are living in poverty
(denoted as Poverty Rate), the state population per square mile (denoted as Density), the
percent of the state population who smoke cigarettes (denoted as Smokers), per capita
ethanol consumption (denoted as Alcohol), the percent of the state population who are
African American (denoted as African Americans), and the percent of the state who are
non-African American and non-Hispanic minority (denoted as Minorities). Note that all
dollar-denominated variables are converted into real terms (base year is 2000) using the
The Centers for Medicare and Medicaid Services (CMS) provide data on two
different measures of U.S. per capita healthcare expenditure. Namely, one measure is
based on the state in which the patient resides (see regression 1), whereas the other is
based on the state in which the healthcare provider is based (which we denote as Provider
Health Exp.). Since there may be discrepancies between these two measures, the second
addition to the 11 regressors included in Xit from regression 1, the following variables are
added: an index from the American Conservative Union (denoted as A.C.U.) measuring
20
how conservative are the voting records of each state's Congressional members
(essentially higher values indicate a more conservative voting record), the number of
abortions per 1,000 women between the ages of 15 and 44 (denoted as Abortion), the sum
of the birth rates for 5-year age groups (multiplied by 5) which measures total fertility
(denoted as Total Fertility Rate), the number of live births to women between the ages of
15 and 19 per 1,000 women (denoted as Teenage Birth Rate), and the percent of the
expenditure affects the infant mortality rate, the opposite could also hold true. That is,
the infant mortality rate may affect healthcare expenditure, since the medical need
associated with higher infant mortality will increase healthcare spending, ceteris paribus.
healthcare spending (but not infant mortality). Included in the set of possible
instrumental variables are per capita cancer deaths (denoted as Cancer), medicare
spending per enrollee (denoted as Medicare), medicaid spending per enrollee (denoted as
Medicaid), and various age demographics (i.e., percent of the population between the
11
The Total Fertility Rate calculates the birthrates per 1,000 women in the state while
adjusting for the age of the population. The total fertility rate would need to equal 2,100
for the population to be at equilibrium (i.e., a rate below this implies a shrinking
population over time while a rate above this value implies a growing population over
time). Corresponding to this equilibrium rate, 1,000 accounts for the mother’s
replacement in the population, 1,000 accounts for the father’s replacement in the
population, and 100 accounts for those who do not reach reproductive years.
21
ages of 65 and 69 (denoted as Age 65-69), percent of population between the ages of 70
and 74 (denoted as Age 70-74), percent of the population between the ages of 75 and 79
(denoted as Age 75-79), percent of the population between the ages of 80 and 84
(denoted as Age 80-84), and percent of the population age 85 and older (denoted as Age
85 and Over). The results of this first-stage regression are used to predict per capita
healthcare expenditure, which then serves as the measure of healthcare spending in the
second-stage regression.
much of the results reported in prior studies. For instance, we expect infant mortality to
decrease (i.e., expected negative coefficients) with increases in per capita income,
number of physicians, the percent of the population that is educated (i.e., high school and
college graduates), and the abortion rate; whereas we expect infant mortality to increase
consumption, the percent of the population that is African American, the total fertility
rate, the teenage birth rate, and the percent of youths who are uninsured. 12 With respect
to healthcare spending, however, in spite of Crémieux, Ouellette, & Pilon (1999) finding
12
The impact of the abortion rate on infant mortality is expected to be negative since it
has been shown that abortions reduce higher risk pregnancies (see Lee, Gartner,
Pearlman, & Gruss, 1980).
The impact of the higher total fertility rate is associated with birth to those of older age,
shorter birth spacing and socioeconomic backgrounds resulting in higher infant mortality
(see Bongaarts, 1986).
22
impacts on infant mortality of other minority populations, population density, and the
3.2 Data
The data used to estimate the regressions came from various sources. For
instance, the U.S. Census Bureau (www.census.gov) provided data on the following
variables: Infant Mortality, Income, High School, College, Poverty Rate, Density,
African Americans, Minorities, Abortion, Total Fertility Rate, Teenage Birth Rate,
Uninsured, Cancer, and the various age demographic variables. The Centers for
Expenditure, Provider Health Expenditure, Medicare, and Medicaid. The Centers for
Disease Control and Prevention (www.cdc.gov) provided data on Doctor and Smokers.
Finally, data on Alcohol came from the National Institute on Alcohol Abuse and
In total, the panel data set consists of 700 observations, representing annual data
from each of the 50 states over the 1991-2004 period. Descriptive statistics are provided
in Table 3.1 below. As the table indicates, for instance, infant mortality ranges from 3.8
(in the state of New Hampshire in the year 2001) to 11.9 (in the state of Mississippi in
1993) deaths per thousand births, whereas both measures of healthcare spending share
13
A.C.U. captures conservative policy, which favors local rather than federal control of
policies. Local control of policies shown in Robalino (2001) lowered infant mortality
rates. However, other conservative policies have unknown impacts on the infant mortality
rate.
23
Figure 3.1 plots every state observation for each year, and the fitted trend line shows that
infant mortality rates have tended to decrease over time, which is consistent with other
studies that have claimed similar downward trends in infant mortality (e.g., see Crémieux
et al., 2001).
Independent Variables:
Residence Health Exp. 3.8840 0.6760 2.4270 (UT) 6.0820 (MA)
Provider Health Exp. 3.8530 0.6950 2.3210 (WY) 6.2570 (MA)
Income 25.3110 5.4740 13.6900 (MS) 42.9240 (CT)
Doctor 227.9490 57.7090 127.0000 (ID) 450.0000 (MA)
High School 82.7070 5.3270 66.1000 (KY) 92.8000 (AK)
College 23.6240 4.7730 1.5000 (AK) 38.7000 (CO)
Poverty Rate 12.4450 3.6390 5.2000 (NH) 26.4000 (LA)
Density 176.5800 241.6750 1.0000 (AK) 1172.8000 (NJ)
Smokers 23.1080 3.0500 10.5000 (UT) 32.6000 (KY)
Alcohol 1.8110 0.3800 0.8850 (UT) 3.4740 (NH)
African Americans 10.3000 9.5000 0.3000(MT) 36.9000 (MS)
Minorities 5.5000 9.9000 0.2000 (NC) 67.9000 (HI)
A.C.U. 52.8790 23.6110 0.0000 (HI, ME)* 100.0000 (WY)
Abortion 14.2290 7.0100 1.7860 (WY) 49.0000 (CA)
Total fertility rate 1991.0680 193.3330 1597.5000 (VT) 2655.0000 (AK)
Teenage birth rate 48.6110 14.1900 18.2000 (NH) 85.3000 (MS)
Uninsured 11.9210 5.0140 3.3000 (VT) 54.0000 (CT)
Instrumental Variables:
Cancer 2.0260 0.3250 0.8880 (AK) 2.7030 (WV)
Medicare 5.1470 0.9670 3.0320 (ID) 7.8800 (LA)
Medicaid 5.4920 1.7150 2.4240 (TN) 18.4410 (HI)
Age 65-69 0.0360 0.0050 0.0170 (AK) 0.0560 (FL)
Age 70-74 0.0320 0.0050 0.0110 (AK) 0.0500 (FL)
Age 75-79 0.0260 0.0040 0.0070 (AK) 0.0390 (FL)
Age 80-84 0.0170 0.0040 0.0040 (AK) 0.0260 (FL)
Age 85 and over 0.0150 0.0040 0.0020 (AK) 0.0260 (ND)
Note that *HI and ME tie with an A.C.U. score of 0.
24
12
10
0
1990 1992 1994 1996 1998 2000 2002 2004 2006
Year
causes of infant mortality for 2004, which is derived from Heron (2007). As indicated,
the leading cause of death. In light of the list in Table 3.2, the Centers for Disease
25
Control and Prevention recommends regular medical visits and the avoidance of alcohol
and tobacco consumption, which are variables explored in this thesis (Department of
(i.e., by the state location of the provider and by the state of residence of the patient).
The data on the state location of the provider measure per capita healthcare spending on
the part of all patients of the provider (i.e., those who reside and those who do not reside
in the state); whereas data on the state location of the patient measure per capita
healthcare spending on the part of the state resident, whether or not that patient received
care from in-state or out-of-state providers. Hence, the primary difference between these
two measures of healthcare spending rests on state residents crossing a state border to
seek care elsewhere. According to CMS, data on both types of healthcare spending have
been available since 1991 as a result of state governments wishing to have more detailed
All data on healthcare spending gathered by the various government agencies are
healthcare “interstate flows” has been determined to link the provider of care to the
location of the patient. 15 For instance, when a resident goes out-of-state for care there is
14 The factors that affect infant mortality and that are most likely under parental control
are those related to behavioral (e.g. cigarette and alcohol consumption) and
environmental factors (e.g., population density).
15
Medicare is the only available source of data in which “interstate flows” can be
calculated and converted from provider to resident health expenditure for all individuals.
26
for care there is an inflow of health expenditure. This interaction between where
individuals live and where they receive healthcare creates a “net flow”, such that states
are either “net importers" or "net exporters" of services. 16 Accordingly, the discrepancy
between the two measures of healthcare spending are indicated in the following:
such that net flow is simply the difference between the two measures of healthcare
spending. In the aggregate (i.e., the sum of equation (2) across all 50 states in any given
year), net flow is zero, and thus the two measures of health expenditure are equal to one
another.
The relationship between the two healthcare expenditure data is further illustrated
in Figures 3.2 and 3.3. As the figures illustrate, although net flow exists, the discrepancy
between the two healthcare spending measures is slight. Moreover, regardless of the
measure of healthcare spending, there is an upward trend in spending over the sample
period.
16
One noticeable source of net flow is from the seasonal migration of individuals from
northern states to southern states. Since CMS only assigns observations based on a single
primary residence, this creates a net flow issue.
27
0
1990 1992 1994 1996 1998 2000 2002 2004 2006
Year
0
1990 1992 1994 1996 1998 2000 2002 2004 2006
Year
Figure 3.4 illustrates that increases in healthcare expenditures over time are also
observed in the public sector. There is a noticeable dip in per capita Medicare spending
28
between 1996 and 2000. This was the direct result of the passage of the Balanced Budget
Act of 1997, which affected Medicare payments by: lowering the growth rate for hospital
reimbursements, introducing a new payment system for nursing homes and home health
providers, and increasing fraud regulations. The upward trend in the data after 1999 was
due to the passage of the Balanced Budget Refinement Act of 1999 and the Benefits and
Protection Act of 2000. These two acts were a revision to cuts in the 1997 law and
8
7
6
5
4
3
2
1
0
1990 1992 1994 1996 1998 2000 2002 2004 2006
Year
As a final point, to illustrate a few other variables in the data set, Figures 3.5 and
3.6 show the trends in state-level abortion and teen pregnancy rates over the 1991-2004
period. With respect to the abortion rate, there is a slight downward trend in abortions
29
over this period, 17 which is consistent with the findings of Rovner (2008). 18 Figure 3.6
also illustrates a downward trend in teen pregnancy rates, which Stein (2011) finds is true
across all age, race, and ethnicity groups. Indeed, the current level of teen pregnancy is
50
Abortion Rate
40
30
20
10
0
1990 1992 1994 1996 1998 2000 2002 2004 2006
Year
17
The trend in the abortion rate did not change when the outliers (i.e., abortion rates of 30
or above) were removed.
18
Not only is the rate of abortion falling, but Rovner also finds the number of abortions
is declining over time. For example, the number of abortions in the United States in 2000
was 1.3 million, while in 2005 there were 1.2 million abortions.
30
60
50
40
30
20
10
0
1990 1992 1994 1996 1998 2000 2002 2004 2006
Year
31
Chapter 4
ESTIMATION RESULTS
Chapter 3 are presented. Specifically, the estimation results of each specification are
presented, with the goal of having a more clear understanding of the determinants of
infant mortality. 19
infant mortality is highly correlated with many of the independent variables we consider.
In particular, the results indicate a strong positive relationship between the infant
mortality rate and the following variables (correlation coefficient between the infant
mortality rate and the respective variable provided in parentheses): African Americans
(0.64), the teenage birth rate (0.61), and the poverty rate (0.46); whereas a strong
negative relationship is found between the infant mortality rate and the following
variables: high school (-0.59), college (-0.49), and income (-0.48). To a lesser extent,
19
Recall, the first specification (Regression 1) is our baseline model and is most similar
to the Crémieux, Ouellette, & Pilon (1999) study in that, in addition to several exogenous
factors, infant mortality is regressed on resident-based healthcare expenditure. The
second specification (Regression 2) is similar to the first, with the exception that the
measure of healthcare expenditure is based on the location of the provider. The third and
fourth specifications add a few more regressors to regressions 1 and 2, with the difference
between the two being that regression 4 considers the endogeneity of healthcare spending
(by utilizing an instrumental variable procedure). For each specification, we consider
four fixed effects treatments (i.e., no fixed effects, state fixed effects, time fixed effects,
and both state and time fixed effects. Note that in all specifications the Hausman test
favored fixed effects over random effects, and so we only report the fixed effects results.
Furthermore, to conserve space, the estimates of the constant term are suppressed from
the tables that follow.
32
infant mortality is negatively correlated with provider healthcare spending (-0.27) and
resident healthcare spending (-0.28), which such correlation coefficients are lower in
absolute value compared to those reported in Crémieux, Ouellette, & Pilon (1999).
However, since the correlation coefficient merely measures the relationship between two
variables, to gain greater insight into the determinants of infant mortality we move to the
The estimation results for regression 1 are provided in Table 4.1. For each of the
fixed effects treatments, an F-test was performed to assess the joint significance of the
fixed effects coefficients. In each case, the fixed effects coefficients were found to be
jointly significant. Furthermore, as expected, the R-square is highest when both state and
time fixed effects are included in the model (increasing from 0.688 when no fixed effects
are included to 0.829 when both state and time fixed effects are included). Accordingly,
our favored fixed effect specification of the baseline model is that which includes both
state and time fixed effects. Nonetheless, as the results in column 4 indicate, statistical
significance of the coefficients drops off substantially when both state and time effects
are included; and so rather than focus solely on those results, we discuss the results of the
The sign of the coefficient of resident healthcare spending across all four
healthcare spending is associated with higher levels of infant mortality. Such a result
runs counter to much of the findings in the literature. Yet when state fixed effects are
included (i.e., columns 2 and 4 of Table 4.1) the coefficient of healthcare spending
becomes insignificantly different from zero, which is consistent with the findings of
Turning to income, the results in Table 4.1 indicate that income has a significantly
negative impact of infant mortality across all four regressions. This can be shown with
34
the income elasticity of infant mortality. 20 The absolute value of the income elasticity
across the four regressions ranges from 0.220 in the state and time fixed effects
specification to 0.424 in the specification without state and time fixed effects, which
places them in the inelastic range, thus indicating that income has a modest impact on
infant mortality. Accordingly, this suggests that access to healthcare is similar across
income levels, which is consistent with the findings of Ringel, Hosek, Vollaard, &
Mahnovski (2002).
As for the remaining variables, to a lesser extent the number of physicians, high
school graduation rates, tobacco consumption, alcohol consumption, and percent minority
are found to also affect infant mortality. Specifically, the infant mortality rate increases
with (i) decreases in the number of physicians per capita (although insignificantly so
when state fixed effects are included), (ii) decreases in high school graduation rates
(although insignificantly so in three of the four regressions), (iii) increases in the percent
of the population that smokes (but similar to physicians, insignificantly so when state
fixed effects are included), and (iv) increases in the percent of the population that is
alcohol is insignificant in columns 1 and 4 of Table 4.1, its impact on infant mortality is
the remaining variables (i.e., college, poverty, and density), since their respective
20
Elasticity is calculated at the mean. In the case of income elasticity of infant mortality,
the income coefficient is multiplied by the mean income over the mean infant mortality.
35
coefficients are insignificantly different from zero across all of the regressions, they do
In terms of the literature, Crémieux, Ouellette, & Pilon (1999) and Cochran,
Leger, and Moore (1978) obtained similar findings with respect to the statistically
significance results for income, physicians, and the number of smokers in a state. In
terms of contrasting findings to this thesis, Crémieux, Ouellette, & Pilon (1999) found
that alcohol consumption leads to a higher infant mortality rate in their study of Canada.
Also in contrast, their study found that college graduation rates lowered infant mortality
rates, while population density increased infant mortality rates. In terms of the minority
variables, Crémieux et. al (2005) found that increases in African Americans increased the
infant mortality rate, which is similar to the findings of this thesis. However, Crémieux
et. al (2005) also found that an increase in other minority groups lowers the infant
mortality rate, which does not support the findings of this thesis.
The estimation results for regression 2 are provided in Table 4.2. Comparing the
results in Tables 4.1 and 4.2, it is apparent that the measure of healthcare expenditure has
little impact on the results. That is, the coefficients of healthcare expenditure are similar
in both tables (although they are somewhat lower in Table 4.2, indicating that healthcare
expenditure as defined by the location of the provider has a slightly smaller impact on
infant mortality). Also, the signs, magnitudes, and significance of the remaining
variables are nearly the same in both tables. Accordingly, rather than spend time
The estimation results for regression 3 are provided in Table 4.3. To begin, since
the measure of healthcare expenditure has little impact on the results, we continue from
As expected, not only is each of the R-square values in Table 4.3 higher than their
counterparts in Table 4.1, but similar to Table 4.1 the R-square in Table 4.3 is highest
when both state and time fixed effects are included. Furthermore, similar to Table 4.1, F-
tests favor the joint significance of the fixed effects coefficients in Table 4.3.
Accordingly, our preferred specification is column 3 in Table 4.3. Similar to section 4.2,
however, we discuss the pattern of the coefficients across all four regressions.
similar pattern in the results provided in Table 4.3. For instance, in the absence of state
mortality decreases with increases in income, physicians, and high school graduation
rates; yet infant mortality increases with increases in smoking prevalence and the percent
Nonetheless, there are a few differences between the results in Tables 4.1 and 4.3.
Namely, in column 1 of Table 4.3 we now find a positive and marginally significant
coefficient of density. Moreover, with respect to Table 4.3, there is a greater (lesser)
share of the coefficients of smokers (alcohol and other minorities) that are significantly
In terms of the additional variables that are added to the regressions, significance
of the coefficients is sparse, with some of the coefficients of abortion, total fertility,
uninsured, and A.C.U. being significantly different from zero; whereas the coefficients of
39
the teenage birthrate are insignificantly different from zero across all of the regressions.
For those cases in which the coefficients are significant, we find a higher rate of infant
mortality in states with lower abortion rates, higher total fertility rate, lower percent of
children in the population that are uninsured, and lower A.C.U. scores.
Many of these results are consistent with the findings of prior studies. In
particular, a higher total fertility rate has been found to be associated with a greater share
of births to women of older age, shorter birth spacing, and lower socioeconomic status,
all of which Bongaarts (1986) found to be linked to higher infant mortality rates. In
states with higher abortion rates, there is a greater share of births that are the result of
planned pregnancies, thus coinciding with greater use of prenatal care and therefore
lower-risk pregnancies (see Grossman and Jacobowitz, 1981), which reduces infant
mortality. 21 Also, as the percent of uninsured children increases, this reduces their access
As for the A.C.U. index, it appears more conservative states have lower infant
mortality rates. Such a link can be explained as follows. Robalino, Picazo, & Voetberg
(2001) found that government policies in which more control was given to the local
allocation. With respect to infant mortality, a more efficient resource allocation coincides
with the adoption of policies that are better able to address unique local characteristics,
thus lowering infant mortality rates. Conservative policy, as noted by the American
Conservative Union in the Sharon Statement, asserts that “the constitution- the division
21
The abortion rate variable results did not change when one or both of the outliers (i.e.,
abortion rates of 30 or above) were removed.
40
of power- is summed up in the clause that reserves primacy to the several states, or to the
people in these spheres not specifically delegated to the Federal Government” (Evans,
1960). In other words, conservative policy is directed towards local government control
greater healthcare spending. Indeed, the positive correlation between health expenditure
and infant mortality suggested in the previous regressions is consistent with healthcare
spending being endogenous. Accordingly, Table 4.4 provides the regression 4 results,
To begin, given the many regressions estimated in Tables 4.1 - 4.3, it is important
to pick the best regression amongst these to explore the presence of endogeneity. This
was done by performing several joint hypothesis F-tests. Specifically, the first test
narrowed down the most appropriate fixed effects treatment, which favored the inclusion
of state and time fixed effects. In the second test, the coefficients of the additional
regressors in Table 4.3 were tested for their joint significance, which was also favored by
the F-tests. Finally, the joint significance of the state and time fixed effects, as well as
22
Of course, one could also argue that more liberal states may adopt policies that reduce
infant mortality. For instance, if more liberal states direct greater spending towards the
poor, this could improve access to healthcare for the poor, and as such, reduce infant
mortality.
41
the additional regressors, favored column 3 of Table 4.3 as the regression to explore the
issue of endogeneity.
a regression should (i) be correlated with the right-side variable and (ii) be uncorrelated
with the left-side variable. Hence, we selected the following variables as candidate
instruments: Cancer, Medicare, Medicaid, and various age demographic variables (i.e.,
Age 65-69, Age 70-74, Age 75-79, Age 80-84, and Age 85 and over). Three sets of
instruments were then considered, the first including all eight of these variables, the
second including only Cancer, Medicare, and Medicaid, and the third including only the
process in which the first-stage involves regressing healthcare spending on the exogenous
spending from the first-stage regression replaces healthcare spending in the regression of
interest. However, with such a procedure, it is important to check that the instruments are
valid (i.e., they are exogenous); and so Table 4.5 provides results of various tests
Concerning Table 4.5, initially the third set of instruments (column 3) was
eliminated because the instruments were weak (i.e., the first-stage F-statistic does not
exceed 10). With respect to the column 1 and 2 instrument lists, as indicated they both
contain significant instrument coefficients in the first-stage regression (i.e., they are
strong instruments), and thus are considered for further review to check whether each set
is exogenous. To check for exogenous instruments, the J-statistic is used in which the
null hypothesis is that the instruments are exogenous (the alternative being endogenous
instruments). Utilizing a 5% significance level cutoff, the null cannot be rejected for both
instrument lists in columns 1 and 2 (although the instrument list in column 1 rejects the
Turning to the individual coefficients in Table 4.4, consistent with prior results,
all three regressions show that higher income and A.C.U. values reduce infant mortality.
Also, higher infant mortality is associated with a higher share of the population that is
African American. Such results are consistent with prior studies (e.g., see Crémieux et
al., 2001). However, the remaining variables are largely insignificantly different from
zero, suggesting there may be additional variables worth exploring in future research.
healthcare expenditure; the results in Table 4.4 are somewhat promising. Specifically,
44
although the results in column 1 fail to find a statistically significant link between
healthcare spending and infant mortality (consistent with Leu (1986)), the results in
column 2 now show a negative relationship between resident health expenditure and
infant mortality, which is consistent with the studies by Crémieux et al. (1999, 2001,
2005). Indeed, the healthcare spending elasticity (evaluated at the mean) equals 0.503 (in
absolute value), meaning healthcare spending is inelastic. Lastly, given that the results in
Table 4.5 support instrument exogeneity at a higher significance threshold (i.e., 10%)
To examine how sensitive the results are to functional form, the variables were
converted into natural logs, and the results reported in Tables 4.4 and 4.5 were re-
examined in the context of a double-log specification. The results are provided in Tables
As indicated in Table 4.7, all three sets of instrument coefficients are significantly
different from zero in the first-stage regression, but now the results favor instrument
exogeneity for the column 3 instrument list. As for the coefficients in Table 4.6, with the
exception of column 2, none of the estimated coefficients are significantly different from
in Table 4.4 as well, the results do suggest that functional form, as well as the manner in
which endogeneity of health care spending is addressed, appear to matter when it comes
Finally, a number of the regressors used throughout this thesis are highly
45
variance inflation factors (VIFs), which are based on regressing each variable on all the
constructed. This led us to estimate a regression containing the following reduced set of
variables: Resident health spending, college, smokers, poverty rate, A.C.U., and
multicollinearity; and so such, this led us to also estimate a reduced regression containing
the following variables: Resident health expenditure, smokers, alcohol, other minorities,
similar results as reported in Table 4.6, and so adjusting for multicollinearity has little
23
The VIF associated with Resident health expenditure is 20.37. However, since this
variable plays a prominent role in the regressions, it was excluded from the regressions.
46
Chapter 5
CONCLUSION
This thesis explored the issue of infant mortality by analyzing the impact of
the United States. Some of the determinants of infant mortality include the following:
healthcare spending per capita, income per capita, high school graduation rates, smokers
abortion rate, and the degree of conservativeness of each state. All of the variables
included in the empirical model are relevant to the results found in previous studies of
this topic. In addition, two separate definitions of healthcare spending were explored, one
related to resident healthcare expenditure and the other based on provider healthcare
expenditure. Lastly, this thesis explored the possible endogeneity issue inherit in
This thesis used annual state level data between the years 1991 and 2004 to
estimate four regression models. The first model was considered the base model and used
similar regressors as Crémieux, Ouellette, & Pilon (1999). The second model took
the first model, with the exception that resident healthcare spending was replaced with
provider healthcare spending. The third model expanded upon the first model by adding
five additional regressors to that model. The last model explored examined the possible
procedure. The first three models explored the sensitivity of the results to various panel
data treatments (i.e., no fixed effects, one-way fixed effects, and two-way fixed effects),
while the fourth model exclusively adopted a two-way fixed effects specification and also
The linear regression results in this thesis are consistent with the findings of prior
studies of this topic. In particular, it was found that infant mortality decreases with
increases in per capita income, number of doctors, percentage of the population that are
high school graduates, the abortion rate, and the conservativeness of each state. We also
found that infant mortality generally increases with increases in population density,
population that is a minority, and the total fertility rate. In all of the models, the two-way
fixed effects specification was favored as the fixed effects were jointly significant.
between healthcare spending and infant mortality. However, when adjusting for
endogeneity of healthcare spending in the fourth model, the results indicate that
healthcare spending either lowers or has no effect on infant mortality, depending upon the
set of instruments utilized. In the fourth model, other variables remain consistent with
When examining the double-log regression, we find that health spending has no
effect on infant mortality. Models with fewer variables were also examined to rule out
multicollinearity. The results of these models were not very different from the complete
model.
49
In terms of the elasticity values, both the income-infant mortality elasticity and
the healthcare spending-infant mortality elasticity were below one, which indicates that
they are inelastic. Hence, each of these variables has a modest impact on infant mortality,
Future research on this topic could lead to a more complete understanding of the
variables that affect infant mortality. One of the shortcomings of this study is the limited
time frame of available data. For example, healthcare expenditure data was only available
for the years 1991 to 2004. It would be advantageous for future researchers to examine
whether more recent data show similar relationships between the variables studied in this
thesis.
In addition, the specifications considered in this thesis may suffer from the
inclusion of less-than-ideal regressors. For example, our use of an index from the
may be less-than-ideal, as (i) this index does not encompass all aspects of the
conservative agenda and (ii) is constructed from the voting records of congressional
members (which may not reflect the general degree of conservativeness of the state
population).
Lastly, regression model four illustrated that the sign of the coefficient of
healthcare spending was sensitive to the choice of instrumental variables. As such, future
treatments.
50
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