Age Profiles for Fiscal Spending on Education and Health using NTA Data

1. Age Profiles for Fiscal Spending on Education and Health using NTA Data

2. Regional Patterns Education spending age range=0-30 Health spending age range=0-49

3. High Income Non-European Western Countries

4. Normalized Education Expenditure for non-EUR Western Countries Public spending on Education generally rises sharply during primary educational starting years and falls in late teen years. Canada has highest level of public spending on education whereas US has the higher level of private spending on education , after normalized by labor income.

5. Public spending outweighs private spending in an economically significant way starting from age 5 until early 20s for Australia and USA. The difference between public and private spending is the largest in Canada, consisting of almost 15% of average prime age labor income from age 6 to age 17.

6. Normalized Health Expenditure for non-EUR Western Countries All three countries at relative low levels (below 0.05) for their normalized expenditure on Health (except for Canada at age 0).

7. Normalized Health Expenditure for non-EUR Western Countries Private spending in health declines from 0.06 to below 0.02 between age 0 and age 5. Since then, generally upward trend gradually until the end of prime working age. Note the almost linear relationship between private health spending in Australia.

8. Notably in Canada, normalized public spending is bigger than private expenditure in all ages whereas in the USA, private health spending surpasses public spending consistently and the difference grows bigger at older ages.

9. High Income European Countries

10. Normalized Education Expenditure Most countries in this group have very high level of public spending on education until around age 20.

11. Compared with Public spending on education, private expenditure is considerably low—below 10% of average prime age labor income. Except for Slovenia, France, and Spain, all other countries have less than 4% of average prime age labor income devoted to education in the private sector.

12. Except for Germany between age 0 and 5, all countries have public education spending dominating private education expenditure. The time horizon at which the difference narrows down corresponds to overall low levels of spending on education in both sectors.

13. Normalized Health Expenditure Public spending on health remains relatively stable for most European countries, except with some dramatic decrease between age 0 and age 1 for Sweden, Spain, and Slovenia. Overall, CGH experiences steady upward trend between age 40 and 49, signaling increasing demand for health care towards the end of working age.

14. CFH remains at relative low levels below 0.01 for almost all countries until age 25 and then start rising sharply as one steps into prime working age. However, the absolute level of private spending on health is significantly below that of public spending.

15. All countries have experienced relatively larger public spending on health compared to private spending. The difference have remained relatively constant for some countries; for France and Slovenia, however, there seems to be an upward trend towards the end of the prime working ages.

16. Latin American Countries

17. Normalized Education Expenditure Chile has very low level of education expenditure from the public sector. Colombia has the highest normalized CGE among all Latin American countries between age 7 and 17. In Uruguay, CGE begins to fall after age 11 to well below 10% of average prime age labor income. After age 20, Costa Rica seems to be leading in terms of having the highest level of public spending on education among the NTA Latin America Countries.

18. Overall, public expenditure on education counts towards less than 10% of the average prime age labor income across the age profile in all countries except Jamaica and Uruguay—these two countries also experience more variations, together with Mexico.

19. No clear patterns emerge for the region as a whole. However, the difference between public and private spending on education is the largest from primary education to secondary education—in this period, more countries have the public sector dominating (except for Uruguay and Jamaica). On the other hand, once past age 18, there seems to be an even split in domination between the public and the private sector.

20. Normalized Health Expenditure Most NTA Latin America countries experience gradual increase in public sector health spending after age 30, except for Peru (whereby CGH is going down) and for Costa Rica (whereby there are big fluctuations. CGH decreases from age 0 until early to mid teen years. However, the story for the region of cohorts between mid-teen years and age 30 is mixed.

21. CFH remains below 4% of average prime age labor income in Jamaica, Mexico, Argentina, and Costa Rica. Uruguay has the highest CFH age profile among all countries relatively speaking. In Chile, for the age cohort between 7 and 20, the normalized CFH remains constant. The older the age cohort, the higher the demand for CFH until age 42.

22. No clear regional pattern emerges for the region as a whole. Most of the age cohorts in Uruguay and Peru seem to experience a domination of private expenditure in health whereas the domination is evenly split for countries like Chile. In Costa Rica and Mexico, however, CGH dominates CFH across the age profile.

23. South and Southeast Asia Countries

24. Normalized Education Expenditure Thailand has the highest level of normalized CGE compared to the other three countries. Thailand and India reach the highest levels in the late-teen-years cohorts whereas Indonesia and Vietnam reaches the maximum level before the 10-year-old age cohort and then drops thereafter. Vietnam has the highest level of CFE among the NTA South and Southeast Asia Countries. All countries reach the peak of CFE level after age 15 cohort, suggesting that private spending in education is the greatest in secondary/high school levels.

25. In Vietnam, the private sector seems to outweigh the public sector where as in Thailand it is the opposite story. In Indonesia, for age cohorts of 18 years old and before, public sector invests more in education whereas after age 18, private sector takes over.

26. Normalized Health Expenditure In both cases, health spending remains a rather small proportion of the average prime age labor income. India’s CGH starts rising after age cohort 25 whereas no significant increase is observed for the other three countries.

27. Overall, private spending in health plays an important role in South and South East Asian countries. In Thailand and Vietnam, CGH is larger than CFH across the age profile. In India and Indonesia, CGH starts to outweigh CFH after the age 20 cohort.

28. East Asian Countries

29. Normalized Education Expenditure Japan has exceptionally high levels of public education spending starting from age 3 cohort to age 23, not only among E Asian countries but also highest among all NTA countries. Taiwan’s normalized private spending on education exceeds that of China and Korea. However, Japan’s private expenditure on education is significantly higher than the other three countries.

30. Two dips in Japan’s age profile—possibly less government support in kindergarten level and university level?

31. Normalized Health Expenditure Japan again spends heavily on education from the public side. The proportion decreases quite significantly from age 0 to age 5 (same is observed for private expenditure.

33. African Countries

34. Normalized Education Expenditure For CGE, there seems to be a regional pattern across the age profile. South Africa has higher level of CGE; Nigeria has significantly higher level of CFE compared to the other four African countries.

35. Nigeria has apparent private sector dominance in education spending. The patterns for the other four countries are quite similar.

36. Normalized Health Expenditure CGH is at very low level across all African countries. Relatively speaking, South Africa fares slightly better. Nigeria has a much higher level of normalized CFH than all other African countries until after age cohort 35 onwards from which South Africa overtakes. South Africa follows patterns in other three countries closely until after the cohort of age 20 after which CFH grows.

37. Only Mozambique has a slight public dominance of health spending. In Nigeria, normalized CFH remains higher than CGH across the age profile and the difference is bigger than the other three countries. In South Africa, the gap between CGH and CFH widens after the cohort of age 31.