Analyzing the impact of fiscal decentralization on efficiency, and improving the performance of health care and treatment in Iran

Most economic theories are based on the belief that decentralization of public expenditure will lead to an increase in provincial benefits and a consequent improvement in economic and social indexes. The purpose of this study is to analyze the effect of financial decentralization on the health sector in Iran.
In this applied research, the topic was reviewed by the panel vector self-regression model, using data from 31 provinces of Iran in the period of 2001-2015, with a sample size of 3720 observations.
The results show that financial decentralization, on the basis of indexes reviewed in this study, has a positive causality relation with the number of active hospital beds and the level of public sanitation from gross domestic product. Regarding to the results of variance analysis, it can be acknowledged that the changes in the areas of health and sanitation usually resulted from changes in financial decentralization and the resources allocated to sanitation, which explain the fluctuations of 1.58 and 0.48 percent. The results of reviewing the immediate response functions also indicate the positive effects of funding decentralization shocks on the index rate in the health area.
Financial decentralization and proper distribution of central government health funds to the provinces, can improve the level of public health in the whole country, by increasing provincial sanitary resources, and in addition, promoting health and sanitation indexes.