Working Paper: CEPR ID: DP5246
Authors: Peter L. Lorentzen; John McMillan; Romain Wacziarg
Abstract: Analyzing a variety of cross-national and sub-national data, we argue that high adult mortality reduces economic growth by shortening time horizons. Higher adult mortality is associated with increased levels of risky behaviour, higher fertility, and lower investment in physical and human capital. Furthermore, the feedback effect from economic prosperity to better health care implies that mortality could be the source of a poverty trap. In our regressions, adult mortality explains almost all of Africa's growth tragedy. Our analysis also underscores grim forecasts of the long-run economic costs of the ongoing AIDS epidemic.
Keywords: fertility; growth; human capital; investment; mortality
JEL Codes: I10; J10; O10
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| high adult mortality (I12) | shorter time horizons (D15) |
| shorter time horizons (D15) | decreased savings (D14) |
| shorter time horizons (D15) | decreased investment in human capital (J24) |
| high adult mortality (I12) | decreased investment in physical capital (E22) |
| high adult mortality (I12) | economic growth (O49) |
| economic growth (O49) | better health care (I19) |
| better health care (I19) | high adult mortality (I12) |
| high adult mortality (I12) | poverty trap (I32) |
| high adult mortality (I12) | increased fertility rates (J13) |
| high adult mortality (I12) | risky behaviors (I12) |
| high adult mortality (I12) | lower investment in education (I21) |