Examining the effect of health outcomes on economic growth in selected developed and developing countries

Abstract

Abstract This study aimed to examine the effects of health outcomes on economic growth in selected developed and developing countries. The study utilized annual panel secondary data on life expectancy at birth, adult mortality rate, consumer expenditure, and population growth rate across 15 developed and 18 developing countries, sourced from the International Monetary Fund (IMF) and the World Bank World Development Indicators database. To ensure robust empirical analysis, the study employed dynamic panel data techniques, including descriptive statistics, unit root test, feasible generalized least square (FGLS), correlation analysis, co-integration test, and cross-sectional dependence test, while diagnostic tests such as serial correlation, homoscedasticity, heteroscedasticity, and normality tests were conducted to validate the model. The findings revealed that life expectancy at birth exerts a positive and statistically significant effect on economic growth, while adult mortality rate has a negative and significant impact across both developed and developing countries. Household consumption expenditure showed a strong positive and significant influence on real GDP per capita, whereas population growth rate exhibited mixed effects. The results further confirmed that health outcomes significantly influence economic growth, with stronger effects observed under the FGLS estimation. Health outcomes play a fundamental role in shaping economic growth in both developed and developing countries. The study concludes that improving population health enhances labour productivity, strengthens human capital, and supports sustained economic growth. It recommends that governments should sustain investment in healthcare systems, improve service delivery, promote disease prevention programs, and ensure equitable access to healthcare in order to enhance economic performance and long-term stability.