ASSESSMENT OF THE IMPACT OF HEALTH CARE INVESTMENT ON ECONOMIC GROWTH IN NIGERIA

Abstract

This paper examined the impact of public health investment on economic growth in Nigeria spinning from 1981 – 2020. Gross Domestic Product (GDP) was proxied to economic growth as the dependent variable while recurrent health investment (RHI), capital health investment (CHI), domestic health spending (DHS) and external health investment (EHI) were used to represent the health investment parameters as the independent variables. This paper applied Augmented Dickey Fuller (ADF) and Philips-Perron (PP) tests for unit root which indicated that all the variables were stationary at first difference except gross fixed capital formation at level. While, Autoregressive Distributive Lagged (ARDL) model was employed for examining the impacts of the independent variables on the dependent variable. From the results of the analysis so far, this paper concludes that, Recurrent health investment, Capital health investment, Domestic health spending and External health investment have positive impacts on economic growth in Nigeria during the period understudy. It is therefore recommends that: Monetary authority should maintain and sustain a deliberate fiscal and monetary policy measures that could encourage external health financing by external donors agencies to the health sector for promoting and sustaining economic growth in Nigeria; Government should increase its health investment that would provide more health infrastructure in health facilities and diseases control through increase in domestic health financing in the health sector as the effects shall be transferred to the economic growth. In addition, Government should continue to provide policy that would ensure macroeconomic stability especially foreign exchange rate and interest rate stability that would encourage increase investment in human capital by individuals and the private sector in Nigeria.