The impact of health on economic growth: a panel data investigation.

Abstract

In this study, using an unbalanced panel of 21 economies and a very large time period ranging from 1821 to 2008, we investigate the relationship between health and economic growth. We follow modern econometric techniques that include panel cointegrating analysis and panel Granger causality in order to examine the link both in the short-run and in the long-run. We, also, employ fully modified ordinary least squares (FMOLS) and dynamic ordinary least squares (DOLS) methods to estimate the cointegrating equations. Moreover, we distinct the impact of health standard of the two genders on total and per capita GDP. We find that total life expectancy, male life expectancy, and female life expectancy have all a positive and statistically significant effect on both total and per capita income in the short-run and the long-run, too. As a consequence, we suggest that health should be considered as an important ingredient of the economic performance of an economy.