Impact of Government Expenditure on Health Sector of Pakistan

Abstract

Health is very important for human being which determines the productivity of individual and leads the country towards targeted economic growth. This paper studies the impact of government expenditure on health sector of Pakistan. Over the period 1990-2012. ARDL technique is used for examining cointegration among variables. The impact of different factors in form of infant mortality rate government expenditure % of GDP, improved sanitation facilities and literacy rate over health sector of Pakistan (crude death rate, crude birth rate) is analysed. The empirical evidence shows that infant mortality rate has a positive relationship with crude death rate whereas improved sanitation facility and government expenditure has negative relationship with crude death rate. Infant mortality rate has a positive relationship with crude birth rate, literacy rate has a negative relationship with crude birth rate and government expenditure has a positive relationship with crude birth rate. These empirical findings suggest that health sector can be improve if the sanitary facilities are improved, better education can reduce infant mortality rate. This could be done if the government expenditure is utilized in an effective and transparent way.