Investigation of the Impact of Renewable Energy and Carbon Emissions on Health Expenditures in Iran

Mohammadreza Arefian ¹ ( Ph.D Student in Ecinomics, Department of Economics, Tarbiat Modares University, Tehran, Iran, [e-mail] )
Abbas Assari ² ( Associate Professor, Department of Economics, Tarbiat Modares University, Tehran, Iran (Crossponding Authur), [e-mail] )
لطفعلی عاقلی ³ ( Associate Professor, Department of Economics, Tarbiat Modares University, Tehran, Iran, [e-mail] )
Ali Asgary ⁴ ( Professor, School of Administrative Studies, York University, Toronto, Canada, [e-mail] )

Submited date : 2025-01-23 Accepted date : 2025-03-24

Keywords: environmental pollution, age dependency, urbanization, energy consumption,

Abstract :

Health, as the most valuable asset of humanity, is often priceless. In recent decades, the increasing consumption of fossil fuels and its associated consequences, including carbon emissions and environmental pollution, have led to the exacerbation of diseases, challenges in healthcare systems, and even higher mortality rates in many countries. Moreover, urbanization and demographic changes have emerged as new challenges in the health sector. This study, using time-series data and the autoregressive distributed lag (ARDL) model, examines the impact of environmental and social factors—including renewable energy, carbon emissions, urban population growth and the age dependency ratio—on health expenditures in Iran during the years 1990 to 2019. The indicators studied include government health expenditures, renewable energy consumption as a percentage of total energy consumption, annual urban population growth, and the age dependency ratio as a percentage of the active population.

The results indicate that increases in carbon dioxide emissions, urban population growth, and the  age dependency ratio are associated with higher health expenditures. In contrast, renewable energy consumption, by reducing carbon dioxide emissions, has a negative and significant effect on health expenditures. In other words, increased consumption of renewable energy leads to improved public health and a reduction in associated costs.

The findings of the study underscore the importance of developing renewable energy in enhancing environmental quality and reducing the financial burden on the healthcare system. It is recommended that the government diversify renewable energy sources, replace fossil fuels, and focus on green growth to foster environmental improvement and promote public health.

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