Health and Long Run Economic Growth in Selected Low Income Countries of Africa South of the Sahara : Cross country panel data analysis

University essay from Södertörns högskola/Institutionen för samhällsvetenskaper

Abstract:

Health is one of the most important components of human capital. It can affect production level of a country through various channels. In this study the causal relationship of health and real GDP per capita income in 5 low income countries of Africa south of the Sahara is analyzed using granger causality test. Unbalanced panel data set during the year 1970 to 2009 is used. Life expectancy and mortality rate are used as a proxy for health.

The result revealed that mortality rate has a significant and negative impact on real per capita income. The Granger causality test showed, real GDP per capita and mortality rate have causal or bidirectional relationship. On the other hand, real GDP per capita does not granger cause life expectancy, but life expectancy granger cause real GDP per capita.

The comparative descriptive analysis of the health indicators in different income groups of the world also showed that, higher income countries are better off in their health status.

 

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