This paper revisits the relationship between health care spending and healt
h outcomes. While previous researchers found it difficult to establish such
a relationship based on international comparisons, the results based on ra
ther homogenous province-specific Canadian data show that lower health care
spending is associated with a statistically significant increase in infant
mortality and a decrease in life expectancy in Canada.
This relationship is independent of various economic, socio-demographic, nu
tritional and lifestyle factors, as well as provincial specificity or time
trend. It is based on annual data collected from the ten Canadian provinces
over 15 years. (C) 1999 John Wiley & Sons, Ltd.