Income inequality, health expenditure and outcomes in Nigeria

Abstract

This study investigated the nexus between income inequality and health status in Nigeria. Life expectancy, public health expenditure and infant mortality rate were used as proxy for health. The study presumed that the link between income inequality and health is better investigated through the use of inter-temporal measures such as growth rate and per capita indicators since income inequality and health are macroeconomic variables with microeconomic foundations. The technique of Autoregressive Distributed Lags (ARDL) was used on secondary data spanning 1980 to 2015. The study sought to ascertain whether a long-run equilibrium condition holds among the variables in the model and a reparameterized ARDL was used to examine the short-run dynamics of the variables’ interaction. The study found the link between income inequality and health to be measure sensitive; depending on the indicator used for empirical investigations. The use of qualitative measures such as life expectancy and infant mortality rate indicate that income inequality does not matter for health status in Nigeria.

Keywords: Income inequality, Health expenditure, Health outcomes, Life expectancy, Infant mortality rate