The Impact of Ebola Virus Disease on Government Expenditure in Sierra Leone

Abstract

Ebola Virus Diseases (EVD) epidemic had a pronounced socio-economic impact in Guinea, Liberia and Sierra Leone, which led to a considerable negative effect on the total governments' budgets. One of the Ebola-welfare transmission mechanism is the decreasing government revenue resulting from the closure of mining and food companies of the affected countries, which impact negatively on the growth of the economy and government expenditures of the affected country. This study investigates the effect of Ebola outbreak on the capital expenditure of the Sierra Leonean government. The study employs Endogenous Growth Model of Public Expenditure, which assumes that Gross National Income (GNI) growth is determined by forces governing the production process rather than by forces outside it. The data for the study were obtained from the World Bank Data repository and the International Monetary Fund, and covered the period 2006–2014. The results show that EVD impacted negatively on government capital expenditure in Sierra Leone. Hence, it is suggested that focus should be given more to the prevention of the epidemic of communicable disease.