Assessing the Vulnerability of the Household Health Expenditure in Each Province in terms of the Fluctuations of Economic Variables

Purpose: Health expenditure has a significant impact on social and economic life of human societies and includes an important share of the household basket. In recent years, the economic shocks that occurred in the country led to a change in household consumption patterns, especially in the area of health expenditure. 
Therefore, considering the importance of this sector in development and economic growth of the country, it is necessary to examine the effects of these shocks on this sector. Therefore, the present study investigates the effects of shocks of macroeconomic variables on household health expenditure in different provinces. 
Method: The Bayesian Panel VAR model in Matlab software was used to estimate
data during the period 2001-2019 for all provinces of Iran.
Findings: The results showed that inflation shock, government spending shock, oil revenue shock as well as the exchange rate shock have a positive and significant effect on the household health expenditure in all provinces. Meanwhile, the results of analyzing the variance show that after 20 periods, except for the variable effect, the maximum and minimum impact of shocks on health expenditure for most of the provinces were inflation and exchange rates, respectively.  
Findings: The results showed that inflation shock, government spending shock, oil revenue shock as well as the exchange rate shock have a positive and significant effect on the household health expenditure in all provinces. Meanwhile, the results of analyzing the variance show that after 20 periods, except for the variable  effect, the maximum and minimum impact of shocks on health expenditure for most of the provinces were inflation and exchange rates, respectively.
Conclusion: Considering the positive impact of shocks on increasing the household health expenditure and also high importance of this variable in economic growth and development, it is necessary for the government and planners to have appropria policies and programs to reduce the effects of these shocks and supporting vulnerable households, especially in recent years, when these fluctuations have intensified.