The Effects of Types of Health Services on the Economic Growth of Iran Using the Johansson - Juselius Convergence Method

Subject Areas : medical documents

Ebrahim ghaed ¹ (PhD Student in Economics, Ferdowsi University of Mashhad, Mashhad, Iran, (Corresponding Author), [e-mail])
Mohammadtaher Ahmadi Shadmehri ² (Associate Professor, Department of Economics, Ferdowsi University of Mashhad, Mashhad, Iran)
mozhgan moradi ³ (Master's degree, Department of Economics, Shahroud University of Technology, Shahroud, Iran)
Mohammad Sadeq mohammadi ⁴ (PhD student in Economics, Ferdowsi University of Mashhad, Mashhad, Iran)

Received: 2020-03-03 Accepted : 2020-05-21 Published : 2020-05-21

Keywords: Johansson- Juselius Method, health care services, Economic growth, Vector Error Correction Model,

Abstract :

Introduction: One of the most important parameters for improving the level of GDP and economic growth in Iran is the role of the health services sector and its related indicators. In this regard, many studies have been conducted, but the effect of simultaneous separation types of health services on the economic growth of Iran has not been studied. It would be helpful for policymakers to study the health indices in order to recognize the health-care index that has the greatest impact on growth and prioritize it for investment. Therefore, the main purpose of this study is to investigate the effects of Types of health services on the economic growth of Iran. Methods: This study is causal analytical in terms of the method and it is also the applied research in terms of purpose. The method of data collection is documenting – library. For this analysis, Vector Autoregressive Model, Johansson - Juselius Method and Vector Error Correction Model are used. Data collected for the period of 1981 - 2017 Were estimated by Eviews software.  Results: Based on the coefficient of the error correction method indicates that about 0.86 of the short-term imbalance is adjusted in each period to achieve the long-term equilibrium. Further, in the long run, a one percentage increase in the Labor force, labor productivity, population growth rate, ratio of investment to GDP and the of types health care services ( health costs, cost of treatment, cost of education and insurance ratio), leads to 0.67, 1.77, 0.88, 1.12, 5.43, 3.02, 4.85 and 2.09 percentage increase in the GDP, respectively. Conclusion: Health cost has the most effects on economic growth in comparison with other health care services. This result could help policymakers to modify their policies in allocation of expenditures in different sectors of health services and to highlight the investment in this field in order to achieve economic growth and development in the future.

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