African Journal of
Business Management

  • Abbreviation: Afr. J. Bus. Manage.
  • Language: English
  • ISSN: 1993-8233
  • DOI: 10.5897/AJBM
  • Start Year: 2007
  • Published Articles: 4193

Full Length Research Paper

The effect of health expenditure on economic growth in Iran

Mehdi Safdari
  • Mehdi Safdari
  • Economic Faculty, University of Sistan and Baluchestan, Iran.
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Masoud Abouie Mehrizi
  • Masoud Abouie Mehrizi
  • Islamic Azad University, Mehriz Branch, Iran.
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Marzie Elahi
  • Marzie Elahi
  • Islamic Azad University, Mehriz Branch, Iran.
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  •  Published: 14 October 2013

Abstract

In this paper, equivalence relation and long term of five variables gross domestic product growth rate, the ratio of health expenditure to GDP, the ratio of investment to GDP, population growth, growth rate of graduates  and also their influences on each other in Iran from 1973-2008 were analyzed. For this purpose vector autoregressive model (VAR) was used. First, stability of variables was examined by dickey-fuller test. Next, analysis of Johnson test was done for considering the convergence among five variables. The results of this research show that variables of the ratio of health expenditure to GDP, the ratio of investment to GDP and growth rate of graduates have positive effect on growth rate. Also variable of population growth has a negative effect on growth rate.

Key words: Population growth, health expenditure, gross domestic production growth rate, vector autoregressive model (VAR).

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This article is published under the terms of the Creative Commons Attribution License 4.0

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