Analysing the Nexus Between Public Health Spending, Health Outcomes, Labour Productivity and Economic Growth: Evidence from Nigeria

Abstract

This study seeks to determine the impact of public health financing on health outcomes, and also, determine the impact of health outcomes on labour productivity and economic growth by collecting data on the relevant variable between 1981 and 2021 and employing the Two-Stage Least Squares (2SLS) approach. The study found that: rising public health spending significantly improves health outcomes including infant mortality, neonatal mortality and under-five mortality; improved health outcomes enhance labour productivity, but the neonatal mortality rate has the largest labour productivity elasticity. This suggests that a persistent decline in child deaths would contribute to building healthy individuals who grow up to become a healthy and productive workforce. In addition, the study established that improved health outcomes stimulate economic growth. This reflects the magnified impact of good health on labour productivity with multiplier effects on national output. The study suggests some measures and policy options. JEL Codes: H51; I12; J11, J24; J33; O40