The impact of economic development on health : a country-level analysis

Abstract

This study investigates the impact of economic development on health, using a panel of 217 countries (139 high-income and 78 low-income countries for the period 1995-2018). Five dependent variables are included, which are life expectancy at birth, infant mortality, under-5 mortality, survival to age 65 for the female and the male population. The preferred regression method used is fixed effects - two stage least squares modeling (FE-2SLS). The specification includes two measures of economic development, including GDP per capita and the Gini index, as well as other macro-level variables that have been identified as important determinants for population health in the literature. GDP per capita and the Gini index are treated as endogenous variables in the estimation. The results show that, in both country groups, GDP per capita has a positive and statistically significant impact on health, improving life expectancy and survival to age 65 (P <0.05). The Gini coefficient is found to be statistically significant in low-income countries. Other important determinants of population health include CO2 emissions and population growth, especially in low-income countries. This study shows that population health can be boosted through economic growth and the impact is disproportionately felt across country groups.