Public Health Financing, Quality of Life and Economic Growth in Sub-Saharan Africa Countries: Evidence from VAR-Based Panel Granger Causality Approach
Lots of diverse range of socioeconomic conditions, health disparities, and varying degrees of non-access to healthcare services bedevilled sub-Saharan African countries’ economies. On this note, the study investigates the causal relationship among public health financing, quality of life, and economic growth in SSA countries. The study utilizes panel data spanning from 2000 to 2023, sourced from the World Bank Development Indicators. VAR-based panel Granger causality approach was employed as estimation technique. The results of co-integration confirm the existence of a long-term relationship among the variables employed. Further results from panel VAR Granger causality using stacked (common coefficient) and Dumitrescu-Hurlin (individual coefficient) indicates that the null hypothesis that GDP does not Granger cause quality of life is rejected only in the Dumitrescu-Hurlin test (3.410), indicating that economic growth improves quality of life in the long run for individual countries, as well as quality of life Granger causes GDP, meaning that in the reverse side quality of life improvement have a significant positive impact on economic growth, both in the short and long runs. Unidirectional relationship exits from GDP to public health expenditure at Dumitrescu-Hurlin test (5.348). This implies that economic growth leads to higher public health spending in the long run. While no feedback from public health expenditure to GDP. That is, PuH does not Granger caused GDP, indicating that increased in public health expenditure do not directly cause short-term or long-term changes in GDP. Based on these findings, the study recommends that successive governments in the region should allocate more resources to public health so as to increase revenue and societal demands for better healthcare and economic expansion. Long-term improvements in health infrastructure, including enhanced access to healthcare services, preventive health programs, and disease management strategies, should be emphasized to improve labour productivity over time.
Keywords: Public health financing, Quality of life, Economic growth, SSA, VAR-Based Panel Granger Causality
