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Article

Fiscal Decentralization, Local Competitions and Sustainability of Medical Insurance Funds: Evidence from China

by 1,2,*, 1, 1,2, 1,2 and 3
1
The Co-Innovation Center for Social Governance of Urban and Rural Communities in Hubei Province, Zhongnan University of Economics and Law, Wuhan 430073, China
2
School of Public Administration, Zhongnan University of Economics and Law, Wuhan 430073, China
3
Research Center for Environment and Health, Zhongnan University of Economics and Law, Wuhan 430073, China
*
Author to whom correspondence should be addressed.
Sustainability 2019, 11(8), 2437; https://doi.org/10.3390/su11082437
Received: 13 March 2019 / Revised: 20 April 2019 / Accepted: 23 April 2019 / Published: 24 April 2019
(This article belongs to the Special Issue Social Impact Investments for a Sustainable Welfare State)
Local governments are responsible for the management of social medical insurance for urban and rural residents in China. Under the background of fiscal decentralization between the central government and local governments, the strengthening of supervision on medical insurance funds by local governments leads to a reduction in the expenditure of the medical insurance fund, which contributes to its sustainability. By employing the provincial level panel data during 2004–2014, we used a fixed effect model and a spatial autoregression model to investigate whether fiscal decentralization has had a negative influence on the expenditure of China’s new rural cooperative medical system (NCMS) fund. We found that fiscal decentralization has had a significant influence over its per capita expenditure. Our results also indicate that higher fiscal decentralization leads to higher financial aid in the NCMS provided by local governments. Additionally, the expenditure of the NCMS and the local financial aid are influenced by nearby governments. Our results suggest that appropriate fiscal decentralization, which helps to maintain the sustainability of social medical insurance funds, should be encouraged. View Full-Text
Keywords: fiscal decentralization; local competition; the medical insurance fund; sustainability fiscal decentralization; local competition; the medical insurance fund; sustainability
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MDPI and ACS Style

Qian, W.; Cheng, X.; Lu, G.; Zhu, L.; Li, F. Fiscal Decentralization, Local Competitions and Sustainability of Medical Insurance Funds: Evidence from China. Sustainability 2019, 11, 2437. https://doi.org/10.3390/su11082437

AMA Style

Qian W, Cheng X, Lu G, Zhu L, Li F. Fiscal Decentralization, Local Competitions and Sustainability of Medical Insurance Funds: Evidence from China. Sustainability. 2019; 11(8):2437. https://doi.org/10.3390/su11082437

Chicago/Turabian Style

Qian, Wenqiang, Xiangyu Cheng, Guoying Lu, Lijun Zhu, and Fei Li. 2019. "Fiscal Decentralization, Local Competitions and Sustainability of Medical Insurance Funds: Evidence from China" Sustainability 11, no. 8: 2437. https://doi.org/10.3390/su11082437

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