Reassessing the impact of health expenditure on income growth in the face of the global sanitary crisis: the case of developing countries

Brahim Gaies ()
Additional contact information
Brahim Gaies: IPAG Business School

The European Journal of Health Economics, 2022, vol. 23, issue 9, No 1, 1415-1436

Abstract: Abstract In response to the COVID-19 pandemic, developing countries are increasing health spending to save lives. Such a response raises questions about the economic impact of this expenditure in terms of income growth that determines the development trajectory of these countries. This paper is the first to apply dynamic linear and threshold panel data models to capture the dynamic impact of health expenditure on growth on a large sample of developing countries, while addressing endogeneity bias and taking into account different levels of human and physical capital, as well as a set of health expenditure indicators. The main results show that while public and private domestic health expenditure increase income growth, external inflows of health expenditure do not. In addition, this positive impact is enhanced by a higher level of human and physical capital, thereby demonstrating complementarity rather than substitutability between investments in health, physical and human capital.

Keywords: Development economics; Health-led growth hypothesis; Dynamic threshold model; GMM (search for similar items in EconPapers)
JEL-codes: C24 F36 I15 O11 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link)
http://link.springer.com/10.1007/s10198-022-01433-1 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:eujhec:v:23:y:2022:i:9:d:10.1007_s10198-022-01433-1

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/10198/PS2

DOI: 10.1007/s10198-022-01433-1

Access Statistics for this article

The European Journal of Health Economics is currently edited by J.-M.G.v.d. Schulenburg

More articles in The European Journal of Health Economics from Springer, Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ) Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().