Analyzing the Influence of Public Health Expenditure on Economic Growth in Nigeria from 1980 and 2022

Oluwagbemiga Obembe; Herbert Wilson

Oluwagbemiga Obembe College of Public Health, Texila America University
Herbert Wilson Department of Banking and Finance, Faculty of Management Sciences, Federal University, Otuoke, Bayelsa State, Nigeria

Keywords: Budgeting, Economic growth, Healthcare policy, Nigeria, Public health expenditure

Abstract

This manuscript presents a comprehensive analysis of the dynamic relationship between public health expenditure and economic growth in Nigeria over the period from 1980 to 2022. Using econometric techniques and time-series data, the study examines the influence of public health expenditure on the nation's economic development, addressing key questions regarding causality and the direction of impact.

The analysis reveals a statistically significant positive relationship between public health expenditure and economic growth, indicating that increased investments in public health initiatives have a stimulating effect on Nigeria's Gross Domestic Product (GDP). The Granger causality test results further affirm a unidirectional causality running from public health expenditure to economic growth, highlighting the potential of healthcare investments to drive economic development.

These findings hold significant implications for policymakers in Nigeria. They underscore the importance of prioritizing healthcare financing and allocating resources strategically to healthcare infrastructure development, workforce capacity building, and disease prevention programs. Furthermore, efficient resource utilization and equitable access to healthcare services are essential considerations to maximize the impact of healthcare spending.

While recognizing the complexity of the relationship between public health expenditure and economic growth, this study provides compelling evidence of the vital role of healthcare investments in Nigeria's development agenda. It calls for a holistic approach to healthcare policy and budgeting that considers not only the economic implications but also the equitable distribution of healthcare resources and services.

This manuscript contributes to the empirical literature on the nexus between public health expenditure and economic growth, offering insights that are relevant not only to Nigeria but also to other nations seeking to harness the potential of healthcare investments as a catalyst for sustainable economic development.

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