Economic Development and Public Health Expenditures Nexus for South Asian Countries

Abstract

Public health and well-being rank third among seventeen Sustainable Development Goals because they are crucial to economic development worldwide. This study is exploring the linkage between growth and health-development priorities in South Asian countries. The bidirectional relationship between economic development and public health expenditures has been investigated using three Stage Least Squares regression with Least Square Dummy Variable technique to form fixed effects from 1980-2022. First equation explores the health-related determinants of growth while second equation explores the determinants of public health expenditures. The results showed that Economic development and public health expenditures affecting each other positively correlated in South Asian countries, whereby economic growth to health expenditure effect is higher than health expenditure to economic growth. This study proposed that considering the two way causality between health policy and economic growth, sustained growth can be achieved health sector development is prioritized while achieve growth targets.