Title: Does fiscal deficit, public debt, economic growth and energy consumption affect health expenditure in India: an empirical evidence based ARDL bound testing approach
Authors: Tariq Ahmad Lone; Parveez Ahmad Lone
Addresses: Department of Economics, Aligarh Muslim University, Aligarh, Utter Pradesh, R/O: Kaladrang Kulgam P/O: Yaripora Kulgam, 192232, J & K, India ' Department of Education Studies, Central University of Haryana, Mahindragarh, India
Abstract: This paper examines the impact of fiscal deficit, public debt, economic growth and of energy consumption on health expenditure in the country. Annual data for the time period 1980-2019 has been taken for analytical purposes. The bound testing approach ARDL model has been used for testing the long run cointegration among variables. Besides vector error correction model (VECM) has been utilised for determining the direction of causality. The results specify the presence of long run causal relationship between fiscal deficit, public debt, economic growth, energy consumption and health expenditure. However in the short run a single relationship between GDP and health expenditure was observed. These results reveal that all these variables are important but GDP is more important for maintenance of health expenditure. Thus we recommend that prudent public debt management, fiscal discipline, efficient energy consumption and economic growth should go a long way in maintaining the health expenditure and therefore better health outcomes.
Keywords: health expenditure; ARDL bound; VECM; vector error correction model; cointegration; causality.
International Journal of Happiness and Development, 2022 Vol.7 No.1, pp.1 - 14
Received: 06 Jan 2021
Accepted: 10 Jun 2021
Published online: 15 Jul 2022 *