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How Effective is Public Health Care Expenditure in Improving Health Outcome? An Empirical Evidence from the Indian States

Publication date

Mar, 2020


NIPFP Working Paper No. 300


Ranjan Kumar Mohanty and Deepak Kumar Behera


The literature on public health spending and health outcomes remain an important contribution in implementing public health policies in developing countries. The purpose of this study is to investigate the effects of public health expenditure on various proximate and ultimate health outcomes during 2005-2016 using panel fixed-effects models across 28 Indian States. The empirical results show that per capita public health care expenditure has an adverse effect on the infant and child mortality rate, malaria cases, and a favourable effect on life expectancy, immunization coverage across States, while this impact is relatively weak in the case of High-Focus States. The study is very relevant in the context of achieving the targets of Sustainable Development Goals and moving towards the universal health coverage at the State level in India. It suggests for enhancement of public health spending, and improvement of health infrastructure among the Indian States.
Keywords: Public Health Expenditure, Life Expectancy, Infant Mortality, Child Mortality, Fixed Effects Model, Indian States
JEL Classification Codes: H51, I10, I18, C23
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