The dynamic relationship between health expenditure and economic growth: is the health-led growth hypothesis valid for Turkey?

Emre Atilgan (), Dilek Kilic () and Hasan Ertugrul ()
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Emre Atilgan: Trakya University
Dilek Kilic: Hacettepe University

The European Journal of Health Economics, 2017, vol. 18, issue 5, No 4, 567-574

Abstract: Abstract The well-known health-led growth hypothesis claims a positive correlation between health expenditure and economic growth. The aim of this paper is to empirically investigate the health-led growth hypothesis for the Turkish economy. The bound test approach, autoregressive-distributed lag approach (ARDL) and Kalman filter modeling are employed for the 1975–2013 period to examine the co-integration relationship between economic growth and health expenditure. The ARDL model is employed in order to investigate the long-term and short-term static relationship between health expenditure and economic growth. The results show that a 1 % increase in per-capita health expenditure will lead to a 0.434 % increase in per-capita gross domestic product. These findings are also supported by the Kalman filter model’s results. Our findings show that the health-led growth hypothesis is supported for Turkey.

Keywords: Health-led growth hypothesis; Bound test; ARDL model; Kalman filter method; Turkey (search for similar items in EconPapers)
JEL-codes: C32 I10 O12 O13 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (27)

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DOI: 10.1007/s10198-016-0810-5

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