Main Article Content
Objective of the Study: The study examined the nature of relationship between healthcare expenditure and life expectancy in a panel of 45 African Countries, disaggregated into different sub-regions in the continent.
Methodology: The study used fixed effect method and two-stage least square technique to investigate the relationship between life expectancy and life expectancy in the selected African countries, from 2000 to 2015. Aside from the major variables of interest, GDP per capita, basic sanitation and urban population were used as control variables. The choice of countries and time frame were based on availability of data. The data used was sourced from World Bank website, and analyzed using STATA software.
Main Findings: The fixed effect method found that healthcare spending is an important predictor of life expectancy in Africa. It was found to positively and significantly influence life expectancy in West Africa, but significantly and negatively influences life expectancy in Central and Southern regions of Africa. Contrariwise, the two-stage least square shows that healthcare spending is a negative predictor of life expectancy in Central Africa, but not a significant predictor in Eastern, Northern, Southern and Western Africa.
Conclusion: Conclusions from the study are two-fold. It can be concluded that fixed effect method is not a suitable estimation technique for models with endogeneity and reversed causation issues, and that healthcare expenditure is significant negative predictor of life expectancy in Central Africa; but not a significant predictor of life expectancy in Eastern, Northern, Southern and Western regions of Africa.
Boachie MK. Health and economic growth in Ghana: An empirical investigation. Fudan Journal of Public Administration. 2107;910:403–18.
World Bank. World Development Indicators. Washington: World Bank; 2014.
World Bank. World Development Indicators. Washington: World Bank; 2016.
McCarthy F, Wolf H. Comparative Life Expectancy in Africa. Policy Research Working Paper’; 2001.
Anyanwu J, Erhijakpor A. Health Expenditures and Health Outcomes in Africa. African Development Review. 2009; 21(11):400–33.
Heijink R, Koolman X, Westert G. Spending more money, saving more lives? The relationship between avoidable mortality and healthcare spending in 14 countries. European Journal of Health Economics. 2013;14(13):527–538.
Kim T, Lane S. Government Health Expenditure and Public Health Outcomes: A comparative study among 17 countries and Implications for US Health Care Reform. American International Journal of Contemporary Research. 2103;3(9):8–13.
Makuta I. O’Hare B. Quality of governance, public spending on health and health status in Sub Saharan Africa: A panel data regression analysis. BMC Public Health. 2015;15:932-945.
Sirag A, Norashidah M, Siong H, Nik M, Miloud L. The impact of health financing and CO2 emission on health outcomes in Sub–Saharan Africa: A cross–country analysis. Geo Journal. 2016;82(15):1247–1261.
Compah-Keyeke G, Frank G, Marcella A. Public expenditure and health status in Ghana. Journal of Economics and Sustainable Development. 2013;4(7):88–99.
Yaqub J, Ojapinwa T, Yussuff R. Public health expenditure and health outcomes in Nigeria: the impact of governance. European Scientific Journal. 2012; 8(13):189–201.
Sede P, Ohemeng W. Socio–economic determinants of life expectancy in Nigeria (1980–2011). Health Economics Review. 2015;5(2):50-65.
Richards J, Aidan R. Under-Five Mortality: Comparing National Levels and Changes over the Last Decade across Low–Income Countries. Journal of Comparative Policy Analysis: Research and Practice. 2016; 18(12):419–38.
Zaman S, Hossain N, Mehta V, Sharmin S, Mahmood S. An Association of Total Health Expenditure with GDP and Life Expectancy. Journal of Medical Research and Innovation. 2107;1(2):7-12.
Boachi M, Ramu K, Põlajeva T. Public health expenditures and health outcomes: New evidence from Ghana. Economies. 2018;6(58)1-25.
Obrizan M, Wehby G. Health expenditures and life expectancy around the world: A quantile regression approach. Kyiv School of Economics and Kyiv Economics Institute. Discussion; 2012;47.
Sango-Coker E, Bein M. The Impact of Healthcare spending on Life Expectancy: Evidence from Selected West African Countries. African Journal of Reproductive Health. 2018;22(4):64-71.
Jaba E, Balan CB, Robu L. The relationship between life expectancy at birth and health expenditures estimated by a cross-country and time-series analysis. Procedia Economics and Finance. 2014; 15(23):108-114.
Gujarati DN. Basic Econometrics, 4th ed. New York: McGraw-Hill; 2004.
Green WH. Econometric Analysis, 5th ed. Upper Saddle River: Prentice Hall; 2003.
Berger MC, Messer J. Public financing of health expenditures, insurance, and health outcomes. The Humanities and Social Sciences. 2002;(10):253–65.
Plümper T, Neumayer E. Health spending, out-of-pocket contributions and mortality rates. Applied Economics. 2013;340: 2105–13.