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Health, growth and welfare: a theoritical appraisal of the long run impact of medical R&D

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  • Bosi, Stefano
  • Laurent, Thierry

Abstract

This paper aims at providing a simple economic framework to address the question of the optimal share of investments in medical R&D in total public spending. In order to capture the long-run impact of tax-financed medical R&D on the growth rate, we develop an endogenous growth model in the spirit of Barro [1990]. The model focuses on the optimal sharing of public resources between consumption and (non-health) investment, medical R&D and other health expenditures. It emphasizes the key role played by the public health-related R&D in enhancing economic growth and welfare in the long run.

Suggested Citation

  • Bosi, Stefano & Laurent, Thierry, 2011. "Health, growth and welfare: a theoritical appraisal of the long run impact of medical R&D," MPRA Paper 33789, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:33789
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    References listed on IDEAS

    as
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    5. Kei Hosoya, 2003. "Tax financed government health expenditure and growth with capital deepening externality," Economics Bulletin, AccessEcon, vol. 5(14), pages 1-10.
    6. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 103-126, October.
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    More about this item

    Keywords

    Public health ; Medical R&D; Public spending; Endogenous growth;
    All these keywords.

    JEL classification:

    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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