Effect of Health Index on Economic Growth (Provincial Approach)

Abstract

Regional balanced growth is one of the major goals of economic policymakers in the field of sustainable national development; and according to the degree of development and deprivation of the regions, different policies and planning are required. Health is one of the factors affecting human capital, productivity, and sustainable economic development. Therefore, it is necessary to investigate the impact of health on economic growth along with many other effective factors based on the level of prosperity and deprivation of the provinces of the country. This research is a descriptive-analytical and applied study, in which, by taking the form of the Cobb-Douglas production function, the effect of the health index on economic growth is analyzed in three groups of provinces of the country (privileged, relatively privileged, and underprivileged), with the panel data approach of co-integration, and with the fully modified least square. According to the results, the effect of household health expenditure, household education expenditure, construction credits, private investment in housing, urbanization, and the degree of economic participation on economic growth in all three regions has been positive and significant. With a 100% increase in household health expenditures, the GDP of underprivileged provinces will grow 22,2%, while the GDP of relatively privileged and privileged provinces will grow respectively 19,6% and 16,7%. The results also show that the government's focus on health in all provinces, especially in underprivileged and relatively privileged ones, is very effective in strengthening economic growth. The results also demonstrate that the health index is a long-term variable, and health-related policies have long-term effects on economic growth and development.

Keywords

• economic growth
• construction credits
• health
• education
• urbanization
• economic participation
• private investment.