The Effect of HIV/AIDS on Economic Growth of Southern African Countries

Mahlet Gezahegn and Mukti Upadhyay

Asian Economic and Financial Review, 2014, vol. 4, issue 9, 1146-1157

Abstract: This paper contributes to the existing literature by investigating the effect of health on overall economic growth in southern African nations. We examine interactions between health and economic growth by including both education and health among factors of production in a neoclassical growth model. Our findings, based on generalized least squares estimation of panel data models, suggest HIV/AIDS substantially and adversely affects the accumulation of human capital and thereby retards growth of per capita income significantly. While human capital remains crucial for growth, the effectiveness of policy depends on whether its focus is on the particular component of human capital, such as health for southern Africa, which serves as the more binding constraint on the rate of an economy’s growth.

Keywords: HIV/AIDS; Economic growth; Instrumental variables; Recursive model; Education and health; Southern Africa. (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:asi:aeafrj:v:4:y:2014:i:9:p:1146-1157:id:1242

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