Elsevier

Economic Modelling

Volume 32, May 2013, Pages 325-332
Economic Modelling

The impact of scientific research on health care: Evidence from the OECD countries

https://doi.org/10.1016/j.econmod.2013.01.012Get rights and content

Abstract

This paper investigates the impact of scientific research on health care productivity in a set of OECD countries, in the years from 1960 to 2008. To this end, we have matched information collected from the OECD Health Data 2010 with data gathered from the Scopus database on the papers published and their relative citations. Our empirical results suggest that medical research plays an important role in explaining health care productivity, although various countries are characterized by different velocities in assimilating scientific knowledge. Another important result that emerges from our work is that countries characterized by a faster absorption of academic science, such as the US, have on average a milder impact of scientific research on health productivity, compared with countries with slower absorption. As one would expect, we also find that countries absorbing more scientific research also bear higher health costs.

Results from this study may support policy makers in designing incentive mechanisms to improve the impact of medical research on the health care system.

Highlights

► We investigate the impact of scientific research on health care productivity ► We matched data from OECD Health Data 2010 with data from the Scopus database. ► Medical research plays an important role in explaining health care productivity. ► Various countries have different velocities in assimilating scientific knowledge. ► Mild impact of scientific research on health for countries with faster absorption

Introduction

The last decades have witnessed a growing interest in getting accurate information about the impact of science on different sectors of society. In the United States, the STAR Metric Working Group1 was recently launched to measure how scientific research supported by federal funds influences various aspects of the economy, education, environmental and human health. In the UK, the Research Excellence Framework established in 2006 is moving towards a new incentive mechanism, which rewards academic research that contributes to the economic development and well-being of the society. Such interest on the “payback” of investing in scientific research is rising also in view of the fiscal deficits and debts accumulated in the last years in many countries, calling for better accountability for existing research funds. We refer to the work by Salter and Martin (2000) for further discussion on the economic benefits of publicly funded research.

This debate has naturally spilled over to the health care field, where all actors involved, health professionals, academics, policy makers, as well as patients, are increasingly concerned over measuring the returns of research. For example, the Cochrane review group on effective practice in Canada,2 and the Research Unit for Research Utilisation in Scotland3 assess the utilization of research-based evidence across the key public policy and public services areas of health care, education, criminal justice and social care. In 2008, the report “Medical Research: What's it worth?” published by Buxton et al., 2008 attempted an evaluation of the economic impacts of medical research, defined as the health gains net of the health care costs of delivering them, and GDP gains resulting directly and indirectly from the medical research and the further activity stimulated by it. Focusing on cardiovascular diseases only, the authors estimated a rate of return on past expenditures on research investment in terms of net health gains within the range of 6–14 per cent (see also Buxton et al., 1999).

A large number of research papers have tried measuring the effects of scientific knowledge. Since the seminal work by Solow (1957), a large number of studies have incorporated science and technology in the production function, to study their influence on output, productivity growth and international trade, at the firm, district or country level (see, for example, Adams, 1990, Coe and Helpman, 1995, Hall and Mairesse, 1995, Jones and Williams, 1998, Vernon, 1970, Zeira, 2011). The majority of these works use research and development (R&D) expenditure to proxy scientific knowledge, while only few studies approximate it by scientific outputs such as journal articles and citations. Among these, one influential study is that by Adams (1990) who developed a set of indicators of accumulated academic science based on the number of papers published and measured their effect on productivity of manufacturing industries in the US. The author pointed at scientific knowledge as a major contributor of productivity growth, with a lag in effect of roughly 20 years between the appearance of research in the academic community and its effect on productivity in the form of knowledge absorbed by an industry.

Few studies exist on the impact of scientific research on non-economic dimensions. Comroe and Dripps (1976) looked at the sources of the top ten clinical advances in cardiovascular and pulmonary medicine and surgery in the years from 1940 to 1970, and found that these where mainly driven by basic research. Gross et al. (1999) performed a cross-sectional study comparing estimates of disease-specific funding with data on six measures of the burden of disease, for the year 1996. The authors pointed at a weak association between the amount of funding allocated by National Institute of Health and the incidence, prevalence, or number of hospital days attributed to each condition or disease. In particular, the numbers of deaths and years of life lost were only weakly influenced by funding, whereas the number of disability-adjusted life years was strongly predictive of funding. Grant et al. (2000) have studied the bibliographic details of the papers cited in a set of UK clinical guidelines, with the aim of measuring how scientific research affects health care in the UK. The authors found that the median age of papers cited in clinical guidelines was eight years, and that a large part of these papers have been published by authors living in the UK. Ramsey et al. (1993) studied how scientific literature diffuses to clinicians and influences their purchases and use of new technology. The authors examined the literature for magnetic resonance imaging (MRI) during the years preceding and the first five years following its clinical introduction, and found that a substantial number of units were purchased before studies were available comparing them to alternative diagnostic tools. The patterns of diffusion of these technologies pointed at the importance of sources of information less comprehensive and objective than scientific literature in early purchasing decisions. This study also suggested that the recent readership and publication patterns of professional journals may not facilitate effective, rapid information dissemination about innovations to a broad spectrum of clinicians (see also O'Donnell, 2005). Somogy and Schubert (2005), focusing on a single cross section, estimated the correlation between diabetes-related publication in journals and diabetes prevalence for 29 countries. The authors concluded that various correlation patterns may exist depending on the state of wealth and health of nations. Azoulay (2002) studying prescription-drug markets, found that scientific information stemming from clinical trials directly influence physicians' prescription choices.

A related literature in health economics studies the relationship between medical research and the willingness to pay of patients. In particular, Murphy and Topel (2006) developed an economic framework for evaluating how much people are willing to pay for improvements in health and medical knowledge, and applied it to US data over the period from 1970 to 1990. Becker et al. (2007) proposed an economic model to explain why the costs of dying are above the existing estimates of the value of life. The existence of technologies to extend life when it is threatened seems to determine the high value of terminal care. The authors examined the incentives for bringing such technologies to exist through medical R&D.

In this paper, we wish to investigate the impact of medical research on health outcomes in a set of OECD countries. We focus on perinatal mortality as a measure of health outcomes and consider academic research in the field of obstetrician and gynecology. Using data from the Scopus database on the number of publications and citations for each country, we construct an index of accumulated scientific knowledge in this field, common to all countries. Hence, we assess whether, on average, accumulated scientific knowledge has a positive effect on our measure of health outcome, and, if this case, how long it takes for medical research to spill over into practice. As discussed above, the absorption of new scientific knowledge requires resources spent by actors of the health care sector in appropriate training and new investments. Therefore, in this paper we also investigate whether the rise in health productivity due to scientific knowledge improvements is accompanied by an increase in health spending. We finally explore how a shock in academic research is transmitted into health care productivity and health spending. Given the wide heterogeneity of the health care systems in the countries involved in this study, we have carried the analysis country by country. This allows investigating differences in the impact of scientific knowledge on health outcomes across countries, exploiting the temporal variation of data.

The plan of the paper is as follows. Section 2 explains the channels through which scientific research may impact on the health care sector. Section 3 introduces the health care production function. Section 4 describes the data set, while Section 5 summarizes the empirical results. Section 6 gives some concluding remarks and points at some limitations of this work.

Section snippets

The transmission of scientific knowledge into the health care sector

There exist several reasons why academic research is expected to have an impact on the health and well being of a population.

One important channel of diffusion of scientific knowledge is through clinical guidelines, which usually contain a summary of new research on a specific disease or health condition (for example, through a meta-analysis), and provide recommendations that are both scientifically valid and helpful in clinical practice. A consistent body of literature points at the important

The health production function

We now formulate a health care production function where accumulated scientific knowledge is included among the inputs, along the lines of the work by Adams (1990). Let Mit be a measure of health outcome in country i at time t, for i = 1, 2, …, N, and t = 1, 2,.., T. We assume a simple Cobb–Douglas production function for Mit (Arrow, 1962)Mit=Kitηi,KLitηi,LSi,trηi,S,where Kit and Lit are labor and capital inputs in country i at time t, with ηi,K and ηi,L being the corresponding country-specific

Data

In this work, we measure health care productivity as perinatal death, rit, measured by the number of deaths for children within one week of birth, plus fetal deaths of minimum gestation period 28 weeks or minimum foetal weight of 1000 g, expressed as rate over the number of live births in a year. Since perinatal mortality is expressed as a rate, and therefore is bounded between 0 and 1, we take the logistic transformation and set mit = ln(rit/(1  rit)). Data on perinatal mortality and on expenditure

Empirical results

Fig. 1 reports the time series patterns of perinatal mortality in the 9 selected OECD countries in the years from 1960 to 2008. This measure of health outcome has improved greatly among developed countries, reflecting the effect of improved economic and social conditions on the health of mothers and newborns, the effectiveness of health systems, as well as the advances in medical technology. We observe a sudden increase in perinatal mortality in France in the last years of the sample period.

Concluding remarks

This paper aimed at exploring the influence of medical research on the health care system, and ultimately on the health of people, in a group of developed countries. To this end, we have matched information from the OECD health data set on perinatal mortality and health expenditure with information gathered from Scopus on the papers published and their relative citations, in the sector of gynecology and obstetrician. Results suggest that academic knowledge significantly influences perinatal

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