Economic consequences of death and disability in Nigeria

Abstract

Death and disability are two forms of health shocks that have been underexplored in the literature, despite having a devastating effect on human wellbeing. This paper examines the economic consequences of death and disability on household wellbeing in Nigeria. This investigation employs a Nigerian household panel survey from the General Household Survey (GHS) for 2009-10 and 2011-12 and applies random and fixed effects regressions with robust standard error to assess the effect of disability and demise of any member of the household on earnings, hours of work and medical spending. The findings reveal that the income of households is substantially reduced in the face of disability, and death. Disability is negatively associated with earnings though not statistically significant. Disability significantly influenced hours of work among household, death shows a negative relationship with work-hours but not statistically significant. Medical health spending increased significantly among households faced with disability, and death. Labour adjustment within the household cannot fully take care of lost income, although it tends to offset the reduction in hours of work. The regression results reject the hypothesis that households can preserve earnings when faced with death of a household member. A policy that helps mitigate the consequences of death and disability should be pursued by policymakers.