Is health wealth? Results of a panel data analysis
AbstractThe objective of this paper is to determine whether health (measured by life expectancy at birth) contributes to economic growth and the functional form in which it influences per capita income. This links our study to the debate between Neo-classical and endogenous growth theorists on whether investment in human capital can sustain growth indefinitely. Data on 216 countries for the period 1980-2009 has been obtained from World Development Indicators dataset. This enables us to focus on a period characterized by globalization and demographic changes manifested in the form of population graying. Our findings confirm the importance of investment in human capital. But, in contrast to conclusions of endogenous growth models, we find evidence that benefit from increasing longevity tapers off. We conclude by pointing out that it is necessary to extend this study further by incorporating other dimensions of health that are not captured by life expectancy.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 39953.
Date of creation: 09 Jul 2012
Date of revision:
Life expectancy at birth; endogenous growth models; Neo-classical growth models; panel data; human capital;
Find related papers by JEL classification:
- C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
- O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
- I10 - Health, Education, and Welfare - - Health - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-07-23 (All new papers)
- NEP-FDG-2012-07-23 (Financial Development & Growth)
- NEP-HEA-2012-07-23 (Health Economics)
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