Wealth, Education and Demand for Medical Care: Evidence from Rural China

Jin Feng*, Bei Qin, Yangyang Yu

*Corresponding author for this work

    Research output: Chapter in book/report/conference proceedingChapterpeer-review

    1 Citation (Scopus)


    Since the 1980s health care reform in rural China, the coverage of public health insurance has considerably diminished and the price of medical service continues to increase. Using data from the 1991 and 1997 China Health and Nutrition Surveys, this paper examines the rural residents’ demand for medical care and illustrates the impact of the reform. Our study reveals a positive relationship between education and health status, and a negative relationship between education and medical expenditure. Simultaneously, the income effect of medical care is inelastic (0.31), which means that individuals with lower income are burdened with higher medical expenditure. In addition, the income effect significantly influences the decision to seek care when ill, which implies a credit constraint in health care consumption. There has been a persistent increase of inequality in rural China. Our study suggests that the situation is much worse if we take into account the health inequality and higher medical expenditure of the poor people.

    Original languageEnglish
    Title of host publicationInvesting in Human Capital for Economic Development in China
    EditorsGordon G Liu, Shufang Zhang, Zongyi Zhang
    PublisherWorld Scientific Publishing Co. Pte Ltd
    Number of pages16
    ISBN (Electronic)9789812814425, 9789814471091
    ISBN (Print)9812814418, 9789812814418
    Publication statusPublished - Apr 2010

    Scopus Subject Areas

    • Business, Management and Accounting(all)
    • Economics, Econometrics and Finance(all)

    User-Defined Keywords

    • China
    • Education
    • Health care demand
    • Inequality


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