Impact of Life Expectancy on Economics Growth and Health Care Expenditures in Bangladesh

Abstract

Life expectancy is one of the major key indicators of population health and economic development of a country. The main objective of this study was to determine the impact of life expectancy on changes of economic growth and health care expenditure. We also examined trend of life expectancy according to the sex difference. We used multiple regression models to estimate the impact of life expectancy on economic growth and health care expenditure. Elasticity of life expectancy on health care expenditure and economic growth is also estimated. Results show greater life expectancy of females compared with the males over the past 15 years. The higher Gross Domestic Product (GDP) per capita was observed in a longer life expectancy. i.e., one US Dollar (USD) increment in GDP per capita will increase in an average of life expectancy by 33 days. Similarly, increased one unit of per person Health Expenditure Per Capita (HEPC) will increase the life expectancy in an average of 8 days in a year. The higher proportion of total expenditure on health as a percentage of GDP and direct personal expenditure on health by household as a share of private expenditure on health results in also longer life span. We conclude that the increased life expectancy has direct impact on increased per capita real income and higher expenditure on health. This study has some policy implications for Bangladesh, in particular the needs for increased per capita real income and planning for future health and population policies/programs. Therefore, political stability, adequate and suitable social sector policies and government interventions are required to increase life expectancy and economic growth in the country. There is also a need for involvement of health human force in macro and micro policy-makings and critically examine other determinants of health care expenditure.