The Effect of Healthcare Expenditure on the Health Outcomes in Sub-Saharan African Countries

Abstract

Health is a major component for a fulfilled life that everyone in the world desires to acquire. Governments are expected to play a vital role in providing quality health service to their people. Even though an increased health care expenditure is mostly considered as a primary contributor for an improved health outcome, empirical studies however indicate controversial results. The primary objective of this paper is to examine the effect of health expenditure on the selected health outcomes (Life Expectancy, Infant Mortality, Under-Five Mortality and Crude death) in Sub Saharan Africa. The linear dynamic generalized method of moments instrumental variable (GMM-IV) was used on a panel of 39 Sub-Saharan African Countries for the years 1995-2014. Results of this study showed that health expenditure significantly improves life expectancy and lowers infant mortality, under-five mortality & crude death in Sub Saharan Africa. The separate effects of Public and private health expenditures have also shown a significant positive relationship on life expectancy and negative on infant mortality, under-five mortality & crude death. The one period lag of health expenditure was estimated and the regression results indicated statistically significant relationship with health outcomes. In addition to health expenditure, other determinants like Gross Domestic Product (GDP) per capita, urbanization, immunization and basic drinking water brought improvement on life expectancy, infant mortality, under-five mortality & crude death. In contrast, HIV prevalence and unemployment are factors that reduce life expectancy and increase infant mortality, under-five mortality & crude death. This study indicated that health expenditure is an important element in attaining improved health outcome in Sub-Saharan African Countries. Therefore, increasing the amount of health expenditure allocated to the health sector yields a better health status. More on, revising policies to improve GDP per capita, immunization, urbanization and basic drinking water service, and strategies intended to reduce HIV prevalence and unemployment assure a better health outcome.

The role of governance in the health expenditure–health outcomes nexus: insights from West Africa

“…Although when the level of governance is accounted for, the effect of health expenditure on life expectancy ranged between 0.015 and 0.099, as against 0.026 to 0.102 (when governance is excluded). Additionally, socio-economic indicators (sanitation and urbanization) improves life expectancy in agreement with Weibo and Yimer (2019).…”

The Impact of Health Expenditure on Maternal and Child Mortality in African countries

“…The empirical rationale for selecting variables is mainly on the basis of the data availability, past and existing literature. The data on maternal and child mortality were accessed as the health outcomes following Chirwa (2019), Yaqub et al (2012), Novignon et al (2012), Frank (2020) and others; public and private health expenditure were considered following Issa and Ouattara (2012), Rezapour et al (2019), Luong (2020) and others; adolescence fertility following (Goli, 2017) and others; Dhrifi (2018), Weibo and Yimer (2019) and other researchers; urbanization, and incidence of malaria following Kilanko (2019).…”

The Effects of Total Health Expenditure on Economic Growth in Southern and Western sub-Saharan Africa

“…As a result, intensifying the amount of health spending devoted to the health division results in improved health. Furthermore, amending policies to boost capita per GDP, vaccination, urbanization, and basic drinking water provision, as well as initiatives, to minimize unemployment and HIV occurrence, provide a better health outcome [2]…”

“…------ (2) where is the multiplier factor that explains the marginal propensity to consume (0 < < 1), and the function > 0 is the autonomous consumption that is independent of income?…”

“…Furthermore, health spending per capita in North America, Europe, Latin America and the Caribbean, and Sub-Saharan Africa in 2016 was approximately $ 9,031, $3,183, $63, and $84 correspondingly [1]. This demonstrates how distant African countries are from meeting the bare minimum of healthcare requirements and from meeting the healthcare needs of Africans in particular [2]. This has resulted in higher rates of mother and newborn mortality, HIV/AIDS, and other deadly diseases in Africa.…”