Public Health Expenditure, Financial Development and Health Outcomes in Pakistan: An Analysis

Abstract

This study aims to find out the impact of public health expenditure and financial development on health outcomes in Pakistan. An Autoregressive Distributed Lag (ARDL) cointegration framework has been used to analyse data of Pakistan. The results reveal that public health expenditure and financial development affect health outcomes in long and short run, the results based on the cointegration estimations show that a stable, long-run, significant relationship exists between health outcomes and its determinants. Using the error correction mechanism (ECM) for estimation of short run relationship revealed that life expectancy (LE), infant mortality (IM), under five mortality (UFM) have inverse and statically significant relationship with both public health expenditure (PHE) and domestic credit to private sector to GDP ratios (DCPS), which mean expectancy (LE), infant mortality (IM) and under five mortality (UFM) will adjust more quickly towards equilibrium in long run. On the base of our outcomes we suggest the Ministry of Health Pakistan to conduct more consultations with other ministries and other stakeholders in health services as to identify the needs and emphasize on the importance of health program to the society. At the same time, attention should be given to reduce cost of health services especially for the people who can’t afford along with increase in public health expenditure government should release more domestic credit to people so that they can afford more better life style and also focus on female literary can work more effectively as literate mother can understand things more efficiently and with more job opportunities they will become more strong financially.