FINANCIAL DEVELOPMENT, PUBLIC HEALTH EXPENDITURE AND HEALTH OUTCOMES: EVIDENCE FROM NIGERIA

Abstract

This study examined the link among financial development, public health expenditure and health outcomes in Nigeria between 1981 and 2020. Annual time series data was extracted from the Central Bank of Nigeria (CBN) statistical bulletin and the World Development Index (WDI), and the data was analysed using the Autoregressive Distributed Lag Model (ARDL) with Bounds Testing. The result showed that government expenditure on health worsens health outcome (life expectancy) in the short run while it improves life expectancy in the long run. Also, the result showed that the effect of financial development on health outcome is sensitive to the financial development indicator employed while inflation negatively and significantly influenced health outcomes in Nigeria. The study recommends increased spending on the health sector by the government and a stable financial sector, in order to significantly drive the desired level of health outcome in Nigeria.