DO HEALTH-FINANCING REGIME SHIFTS MATTER FOR VULNERABLE EMPLOYMENT? EVIDENCE FROM A COUNTRY-YEAR STATE CLUSTERING APPROACH
DO HEALTH-FINANCING REGIME SHIFTS MATTER FOR VULNERABLE EMPLOYMENT? EVIDENCE FROM A COUNTRY-YEAR STATE CLUSTERING APPROACH

Summary/Abstract: Rising out-of-pocket pressures and renewed attention to financial protection in health systems have intensified interest in how health-financing architecture may shape labour-market vulnerability. This article aims to investigate whether shifts in health-financing regimes, captured as data-driven country-year "states" of the financing mix, are associated with changes in vulnerable employment. An unbalanced annual panel merges OECD health-financing components (government, social insurance, private insurance, voluntary insurance, NPISH, enterprise financing, out-of-pocket and cost-sharing; % of GDP) with World Bank controls (GDP per capita; employment-to-population ratio) and the modelled ILO estimate of vulnerable employment; country-year observations are clustered on financing indicators (k-means) and linked to vulnerable employment using two-way fixed-effects models with country-clustered standard errors, complemented by switchers-only and entry/exit specifications. Relative to the modal social-insurance-dominant state (Cluster 5), the compulsory-private-insurance/high household-burden state (Cluster 6) is associated with higher vulnerable employment (β = 5.802, p < 0.001), a relationship that remains significant among switchers (β = 4.244, p < 0.01). Predicted vulnerable employment equals 21.77 in Cluster 5 versus 27.57 in Cluster 6 (baseline), rising to 34.77 for Cluster 6 when key channels (x3, x7, x8) are added. Entry into Cluster 6 is associated with a short-run decline (β = −1.024, p < 0.01), suggesting that transition dynamics may differ from long-run regime-level differences.

• Details
• Contents