Causality And Exogeneity Issues In Socio-Economic Determinants Of Good Health In Nigeria

Abstract

The premise of this study is to empirically appraise and identify the factors that can promote good health in Nigeria. The study use a VEC and Granger causality/block exogeneity tests methods to explain the linear relationship between the endogenous and exogenous variables and to test whether the endogenous variable life expectancy at birth (LEP) (proxied as good health) can be treated as exogenous. The results show that health expenditures, income per capita, education expenditure, physical environment and unemployment rate are significant in explaining LEP in the long run, while population growth rate did not. In the short run, the result shows that the past value of good health, health expenditure, income per capital and physical environment were positively associated with current LEP, while population growth and unemployment rate were negatively associated LEP. The granger causality/block erogeneity Wald test results show that LEP granger-cause health expenditure, education expenditure and population growth rate. The study therefore, recommended that there is need for government and corporate private organisation to pay attention to these variables that are directly related to good health and adequate macroeconomic policy need to be postulated by the government to reduce cost of health.