Determinants of Public Health Expenditure in Ghana: A Cointegration Analysis

Micheal Kofi Boachie^1, , Isaac Osei Mensah¹, Pauline Sobiesuo¹, Mustapha Immurana², Abdul-Aziz Iddrisu³ and Ishaq Kyei-Brobbey³

¹Department of Economics, Kwame Nkrumah University of Science and Technology, Kumasi, Ghana

²Department of Accounting Studies Education, University of Education, Kumasi, Ghana

³Department of Accountancy and Accounting Information Systems, Kumasi Polytechnic, Kumasi-Ghana

Cite this paper:
Micheal Kofi Boachie, Isaac Osei Mensah, Pauline Sobiesuo, Mustapha Immurana, Abdul-Aziz Iddrisu and Ishaq Kyei-Brobbey. Determinants of Public Health Expenditure in Ghana: A Cointegration Analysis. Journal of Behavioural Economics, Finance, Entrepreneurship, Accounting and Transport. 2014; 2(2):35-40. doi: 10.12691/jbe-2-2-1

Abstract

This paper examines the determinants of public healthcare expenditure in Ghana using annual time series data from 1970 to 2008. The paper explored the stationarity and cointegration properties between public healthcare expenditure, and environmental and socio-economic indicators using ERS optimal point unit root test, and Engle-Granger cointegration tests. By this, we examined the long-run impacts of real GDP, CO₂ emissions, crude birth rate, life expectancy, inflation, and urbanization on public healthcare expenditure in Ghana. FMOLS technique was applied to estimate the long run multipliers of public health expenditure model. The results of the paper show that public health expenditure in Ghana is positively affected by real GDP, policies that aim to improve healthiness of the population as measured by life expectancy and crude birth rates. We find strong evidence that healthcare is a necessity in Ghana. These variables need more and critical attention to achieve improved healthcare.

Keywords:
ghana public health expenditure cointegration life expectancy crude birth rate

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