Effects of healthcare spending on public health status: An empirical investigation from Bangladesh

Abstract

The escalation of healthcare spending in many nations, particularly in emerging countries such as Bangladesh, may be largely attributed to the growing demand for healthcare services. Evidently, there has been a significant expansion in the public funding allocated to the health sector in Bangladesh, intending to enhance health outcomes. Therefore, the purpose of this study was to examine the impact of healthcare expenditure on health outcomes, specifically focusing on the reduction in different mortality rates and the transmission of various infectious diseases. A total of 30 years of data (1990–2019) on the health sector of Bangladesh were collected from different national and international sources. The Vector Autoregression with Exogenous Variables (VARX) model was employed to determine the effects of healthcare expenditure on health outcomes. Results revealed that the per capita health expenditure and the number of doctors showed a significant positive impact on life expectancy and maternal and child health. Also, the government's annual budget on the health sector and number of doctors had a significant positive impact on lowering deaths by Diphtheria, Cholera, Tuberculosis, and Malaria diseases. In order to develop a sustainable healthcare system within the nation, it is imperative for the government to prioritize the allocation of sufficient and effective healthcare funding to cater to the needs of the populace.

Keywords

• JEL Code: H5
• H51
• I110