The Palestinian Economy. Theoretical and Practical Challenges

Proceedings “The Palestinian Economy: Theoretical and Practical Challenges” 359
3.2. Microsimulation Technique
The microsimulation-based decomposition technique involves simulating various
distributions of health care utilisation that would emerge under different hypothetical
scenarios. For each simulated distribution, a CI is estimated using convenient covariance
methods (Lerman and Yitzhaki 1989), and tested using bootstrap methods (Abu-Zaineh,
Mataria et al. 2008). The technique takes as its starting point the notion of perfectly equal
distribution of health care utilisation. This is defined as the counterfactual distribution of
health care that would be observed if all individuals (groups) in the population,
irrespective of their SES, had the same medical and nonmedaical characteristics, with
similar effects on participation and conditional consumption behaviours. Hence, if i, j:
x j , i =
x j & m j,i =
m j – where
d & g, β g = β; g = – then,
x j and
m j are the sample’s means – and if g: b g = b; d g =
i
bˆ
m dˆ
Fx
ˆ ˆ
0
, yˆ
1 2
m2
i
G x
1
participation
conditional use
(8)
This distribution whose CI is necessarily zero constitutes the baseline with which a oneby-one
comparison of each explanatory factor is carried out so as to identify its
contribution to inequality. The first distribution can be derived by assuming different
health care needs as,
ˆ ˆ ˆ ˆ
1, i
2,
i
1
iy , ˆ Gxbm dF x m
(9)
i 1 2
and the transformation C C gives the contribution of heterogeneity in medical-need
ˆ0
to use-inequality. Thus,
y i
1
yˆ
i
I C C C
(10)
( N ) 1 0
1
yˆi yˆi yˆi
The heterogeneity in the behaviour of the SES groups – as related to participation part –
can be obtained as,