IDEAS home Printed from https://ideas.repec.org/a/eco/journ1/2015-02-14.html
   My bibliography  Save this article

Government Health Expenditures and Economic Growth: A Feder Ram Approach for the Case of Turkey

Author

Listed:
  • Serdar Kurt

    (Department of Econometrics, Biga Faculty of Economics & Administrative Sciences, Canakkale Onsekiz Mart University, anakkale, Turkey.)

Abstract

This paper aims to test the direct and indirect (external) effects of health expenditures on economic growth using the Feder Ram model. It uses aggregate and manufacturing industrial production as total output, total government health expenditures, general government cure and pharmaceutical products health expenditures, general government medicine and health expenditures series belonging to the economy of Turkey between the 2006:M01- 2013:M10 period using seasonally adjusted and real monthly data. The results obtained from this study have shown that in general, the direct impact of government health expenditures on economic growth in Turkey is positive and significant and its indirect impact is negative and significant. Moreover, when the coefficient calculated for efficiency is considered, it can be argued that while there are not very significant differences between the government health sector and other sectors, the government health sector is slightly more efficient. In this case it can clearly be seen that there is a requirement to improve and further develop the health sector in Turkey.

Suggested Citation

  • Serdar Kurt, 2015. "Government Health Expenditures and Economic Growth: A Feder Ram Approach for the Case of Turkey," International Journal of Economics and Financial Issues, Econjournals, vol. 5(2), pages 441-447.
    • Handle: RePEc:eco:journ1:2015-02-14
    as

    Download full text from publisher

    File URL: http://www.econjournals.com/index.php/ijefi/article/download/1120/pdf
    Download Restriction: no
    File URL: http://www.econjournals.com/index.php/ijefi/article/view/1120/pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Heshmati, Almas, 2001. "On the Causality between GDP and Health Care Expenditure in Augmented Solow Growth Model," SSE/EFI Working Paper Series in Economics and Finance 423, Stockholm School of Economics.
    2. John Strauss & Duncan Thomas, 1998. "Health, Nutrition, and Economic Development," Journal of Economic Literature, American Economic Association, vol. 36(2), pages 766-817, June.
    3. Matteo Cervellati & Uwe Sunde, 2011. "Life expectancy and economic growth: the role of the demographic transition," Journal of Economic Growth, Springer, vol. 16(2), pages 99-133, June.
    4. Alok Bhargava & Dean T. Jamison & Lawrence J. Lau & Christopher J. L. Murray, 2006. "Modeling the effects of health on economic growth," World Scientific Book Chapters, in: Econometrics, Statistics And Computational Approaches In Food And Health Sciences, chapter 20, pages 269-286, World Scientific Publishing Co. Pte. Ltd..
    5. Biswas, Basudeb & Ram, Rati, 1986. "Military Expenditures and Economic Growth in Less Developed Countries: An Augmented Model and Further Evidence," Economic Development and Cultural Change, University of Chicago Press, vol. 34(2), pages 361-372, January.
    6. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    7. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-1072, June.
    8. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 407-437.
    9. Sibel Bali Eryigit & Kadir Yasin Eryigit & Ufuk Selen, 2012. "The Long-Run Linkages Between Education, Health And Defence Expenditures And Economic Growth: Evidence From Turkey," Defence and Peace Economics, Taylor & Francis Journals, vol. 23(6), pages 559-574, December.
    10. Philippe Aghion & Peter Howitt & Fabrice Murtin, 2011. "The Relationship Between Health and Growth: When Lucas Meets Nelson-Phelps," Review of Economics and Institutions, Università di Perugia, vol. 2(1).
    11. Lago-Peñas, Santiago & Cantarero-Prieto, David & Blázquez-Fernández, Carla, 2013. "On the relationship between GDP and health care expenditure: A new look," Economic Modelling, Elsevier, vol. 32(C), pages 124-129.
    12. Ram, Rati, 1986. "Government Size and Economic Growth: A New Framework and Some Evidencefrom Cross-Section and Time-Series Data," American Economic Review, American Economic Association, vol. 76(1), pages 191-203, March.
    13. Feder, Gershon, 1983. "On exports and economic growth," Journal of Development Economics, Elsevier, vol. 12(1-2), pages 59-73.
    14. Quamrul H. Ashraf & Ashley Lester & David N. Weil, 2009. "When Does Improving Health Raise GDP?," NBER Chapters, in: NBER Macroeconomics Annual 2008, Volume 23, pages 157-204, National Bureau of Economic Research, Inc.
    15. Zon, Adriaan van & Muysken, Joan, 2003. "Health as a Principal Determinant of Economic Growth," Research Memorandum 024, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
    16. Arora, Suchit, 2001. "Health, Human Productivity, And Long-Term Economic Growth," The Journal of Economic History, Cambridge University Press, vol. 61(3), pages 699-749, September.
    17. Newey, Whitney & West, Kenneth, 2014. "A simple, positive semi-definite, heteroscedasticity and autocorrelation consistent covariance matrix," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 33(1), pages 125-132.
    18. MacKinnon, James G, 1996. "Numerical Distribution Functions for Unit Root and Cointegration Tests," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 11(6), pages 601-618, Nov.-Dec..
    19. Gyimah-Brempong, Kwabena & Wilson, Mark, 2004. "Health human capital and economic growth in Sub-Saharan African and OECD countries," The Quarterly Review of Economics and Finance, Elsevier, vol. 44(2), pages 296-320, May.
    20. Chakroun, Mohamed, 2009. "Health care expenditure and GDP: An international panel smooth transition approach," MPRA Paper 14322, University Library of Munich, Germany.
    21. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sinan Erdogan & Eyup Serdar Erdogan, 2023. "Analyzing the asymmetric effect of disaggregated health expenditures on economic growth," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(3), pages 2673-2686, June.
    2. Wei Jiang & Yadong Wang, 2023. "Asymmetric Effects of Human Health Capital on Economic Growth in China: An Empirical Investigation Based on the NARDL Model," Sustainability, MDPI, vol. 15(6), pages 1-16, March.
    3. Channew Maneerat & Snober Fazal, 2020. "The Influence of Tax Revenue, Government Expenditures, Fiscal Decentralization, Carbon Emission and Exports on Economic Growth of Developing Countries," iRASD Journal of Economics, International Research Alliance for Sustainable Development (iRASD), vol. 1(2), pages 1-12, June.
    4. Marwa Sahnoun, 2018. "Does Health Expenditure Increase Economic Growth: Evidence from Tunisia," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 21(67), pages 126-144, March.
    5. Minhas Akbar & Ammar Hussain & Ahsan Akbar & Irfan Ullah, 2021. "The dynamic association between healthcare spending, CO2 emissions, and human development index in OECD countries: evidence from panel VAR model," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(7), pages 10470-10489, July.
    6. Biswajit Maitra, 2018. "Investment in Physical, Human Capital, Economic Growth and Life Expectancy in Bangladesh," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 19(2), pages 251-269, September.
    7. Adel Ifa and Imène Guetat, 2019. "The Short and Long Run Causality Relationship Between Public Health Spending and Economic Growth: Evidence from Tunisia and Morocco," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 44(3), pages 19-39, September.
    8. Songul Cinaroglu, 2017. "A Fresh Look at Out-of-Pocket Health Expenditures after More than a Decade Health Reform Experience in Turkey: A Data Mining Application," International Journal of Economics and Financial Issues, Econjournals, vol. 7(5), pages 33-40.
    9. Mustafa Ozer & Veysel Inal & Mustafa Kirca, 0. "The Relationship Between the Health Services Price Index and The Real Effective Exchange Rate Index in Turkey: A Frequency Domain Causality Analysis," EKOIST Journal of Econometrics and Statistics, Istanbul University, Faculty of Economics, vol. 0(36), pages 21-41, June.
    10. Yuan, Mingqing, 2023. "The nexus between economic growth, healthcare expenditure, and CO2 emissions in Asia-Pacific countries: Evidence from a PVAR approach," MPRA Paper 119994, University Library of Munich, Germany.
    11. Olga Anatolyevna Demidova & Elena Vladimirovna Kayasheva & Artem Vladimirovich Demyanenko, 2021. "Government Spending on Healthcare and Economic Growth in Russia: A Regional Aspect," Spatial Economics=Prostranstvennaya Ekonomika, Economic Research Institute, Far Eastern Branch, Russian Academy of Sciences (Khabarovsk, Russia), issue 1, pages 97-122.
    12. Rimsha Javed, 2021. "Nexus Between Economic Growth, Health, and Education in Pakistan: An ARDL Bound Testing Approach," International Journal of Economics and Financial Issues, Econjournals, vol. 11(6), pages 56-65.
    13. Mohammad Mazharul Islam & Mohammad Nazrul Islam Mondal & Haitham Khoj, 2023. "Effects of Health Factors on GDP Growth: Empirical Evidence from Saudi Arabia," Sustainability, MDPI, vol. 15(11), pages 1-22, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bernard Sarpong & Edward Nketiah-Amponsah & Nkechi S. Owoo, 2020. "Health and Economic Growth Nexus: Evidence from Selected Sub-Saharan African (SSA) Countries," Global Business Review, International Management Institute, vol. 21(2), pages 328-347, April.
    2. Mercedes Gumbau Albert, 2021. "The impact of health status and human capital formation on regional performance: Empirical evidence," Papers in Regional Science, Wiley Blackwell, vol. 100(1), pages 123-139, February.
    3. Bloom, David E. & Canning, David & Kotschy, Rainer & Prettner, Klaus & Schünemann, Johannes, 2018. "Health and Economic Growth: Reconciling the Micro and Macro Evidence," IZA Discussion Papers 11940, Institute of Labor Economics (IZA).
    4. Nadide Halıcı-Tülüce & İbrahim Doğan & Cüneyt Dumrul, 2016. "Is income relevant for health expenditure and economic growth nexus?," International Journal of Health Economics and Management, Springer, vol. 16(1), pages 23-49, March.
    5. Oliver Fritz & Peter Mayerhofer & Reinhard Haller & Gerhard Streicher & Florian Bachner & Herwig Ostermann, 2013. "Die regionalwirtschaftlichen Effekte der österreichischen Krankenanstalten," WIFO Studies, WIFO, number 46672, February.
    6. Alper Aslan & Angeliki Menegaki & Can Tugcu, 2016. "Health and economic growth in high-income countries revisited: evidence from an augmented production function for the period 1980–2009," Quality & Quantity: International Journal of Methodology, Springer, vol. 50(2), pages 937-953, March.
    7. Baldanzi, Annarita & Bucci, Alberto & Prettner, Klaus, 2021. "Children’S Health, Human Capital Accumulation, And R&D-Based Economic Growth," Macroeconomic Dynamics, Cambridge University Press, vol. 25(3), pages 651-668, April.
    8. Boachie, Micheal Kofi, 2015. "Effect of health on economic growth in Ghana:An application of ARDL bounds test to cointegration," MPRA Paper 67201, University Library of Munich, Germany.
    9. Husain, Muhammad Jami, 2010. "Contribution of health to economic development: A survey and overview," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 4, pages 1-52.
    10. Ronald Kumar & Madhukar Singh, 2014. "Role of health expenditure and ICT in a small island economy: a study of Fiji," Quality & Quantity: International Journal of Methodology, Springer, vol. 48(4), pages 2295-2311, July.
    11. Gallardo-Albarrán, Daniel, 2018. "Health and economic development since 1900," Economics & Human Biology, Elsevier, vol. 31(C), pages 228-237.
    12. Nicholas Apergis & Puja Padhi, 2013. "Health expenses and economic growth: convergence dynamics across the Indian States," International Journal of Health Economics and Management, Springer, vol. 13(3), pages 261-277, December.
    13. Panagiotis PEGKAS & Constantinos TSAMADIAS, 2015. "Does Formal Education At All Levels Cause Economic Growth? Evidence From Greece," Review of Economic and Business Studies, Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, issue 15, pages 9-32, June.
    14. MESSAILI, Moussa & KAID TLILANE, Nouara, 2018. "Essai d’évaluation de la contribution de la santé à la croissance économique en Algérie [An assessment of the contribution of health to economic growth in Algeria]," MPRA Paper 88013, University Library of Munich, Germany, revised 18 Jul 2018.
    15. Panagiotis Pegkas & Constantinos Tsamadias, 2017. "Are There Separate Effects of Male and Female Higher Education on Economic Growth? Evidence from Greece," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 8(1), pages 279-293, March.
    16. Annarita BALDANZI & Alberto BUCCI & Klaus PRETTNER, 2016. "The Effects of Health Investments on Human Capital and R&D-Driven Economic Growth," Departmental Working Papers 2016-17, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    17. Sushil Kumar Haldar, 2009. "Economic Growth in India Revisited," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 10(1), pages 105-126, January.
    18. Sefa Awaworyi Churchill & Mehmet Ugur & Siew Ling Yew, 2017. "Does Government Size Affect Per-Capita Income Growth? A Hierarchical Meta-Regression Analysis," The Economic Record, The Economic Society of Australia, vol. 93(300), pages 142-171, March.
    19. Aysit Tansel & Ceyhan Ozturk & Erkan Erdil, 2021. "The Impact of Body Mass Index on Growth, Schooling, Productivity, and Savings: A Cross-Country Study," Koç University-TUSIAD Economic Research Forum Working Papers 2118, Koc University-TUSIAD Economic Research Forum.
    20. Abo-Zaid Salem M, 2011. "The Trade-Growth Relationship in Israel Revisited: Evidence from Annual Data, 1960-2004," Review of Middle East Economics and Finance, De Gruyter, vol. 6(3), pages 63-93, February.

    More about this item

    Keywords

    Direct and Indirect Effects; Government Expenditure; Health Expenditures; Economic Growth and Development; The Feder Ram Model;
    All these keywords.

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eco:journ1:2015-02-14. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ilhan Ozturk (email available below). General contact details of provider: http://www.econjournals.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.