Health expenditure and its repercussions on health status-an analysis of south-asian countries

Government has an essential role in making the health of its population and this role has risen substantially in today’s scenario. This scenario is unlike that of private sector where the prices are high and question of affordability is the biggest challenge thus it becomes prior to study the causality between public health expenditure and health status. The prime objective of this study is to figure out the impact of per capita public health expenditure on health status of the population across countries using infant mortality rate, maternal mortality rate, and under-5 mortality rate as proxies using cross-sectional data of South-Asian countries. Dataset has been prepared by taking annual data for the years 1994 onwards till 2014 from World Bank and World Development Indicators. We adopt a robust Fixed Effects (FE) model as the baseline specification and compare the results with robust OLS and robust OLS with lagged explanatory variables. This study unveils that public health expenditure although is an important factor affecting health outcomes but other social factors such as education, poverty, strong governance, community involvement at all the levels etc. does have a strong impact on health status of a country.