Public Health Expenditures and Economic Growth in Sub-Saharan Africa: A Long-Term Analysis using the VAR panel Method

Abstract

The aim of this paper is firstly to show that the relationship between public spending on health (PHE) and economic growth is not direct, and secondly to examine the impact of public spending on health outcomes in Sub-Saharan Africa. In doing so, a VAR panel model with the approach of Abrigo and Love, (2016) was used for a sample of 25 Sub-Saharan African countries covering the period from 1996 to 2016. The results show that increasing public spending on health has a positive effect on economic growth via life expectancy, but this increase has no effect on the long-term infant mortality rate in the African context. Improving health outcomes through long-term life expectancy positively affects economic growth. So, on the one hand, decision-makers will need to increase their health budgets over the long term. On the other hand, the public sector will need to forge partnerships with the private sector (public/private partnership) to increase healthcare provision, accessibility and improve the health status of the population of sub-Saharan Africa.