Working Paper: NBER ID: w11455
Authors: David N. Weil
Abstract: I use microeconomic estimates of the effect of health on individual outcomes to construct macroeconomic estimates of the proximate effect of health on GDP per capita. I employ avariety of methods to construct estimates of the return to health, which I combine with cross-country and historical data on height, adult survival rates, and age at menarche. Using my preferred estimate, eliminating health differences among countries would reduce the variance oflog GDP per worker by 9.9 percent, and reduce the ratio of GDP per worker at the 90th percentileto GDP per worker at the 10th percentile from 20.5 to 17.9. While this effect is economically significant, it is also substantially smaller than estimates of the effect of health on economic growth that are derived from cross-country regressions.
Keywords: health; economic growth; GDP per capita; productivity; development
JEL Codes: I10; O40
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| health differences among countries (I14) | variations in GDP per capita (O47) |
| healthier individuals (I12) | higher productivity (O49) |
| higher productivity (O49) | higher income (D31) |
| improvements in health (I14) | better worker productivity (J29) |
| better health (I19) | increased savings for retirement (D14) |
| better health (I19) | higher levels of physical capital per worker (J24) |
| healthier students (I19) | lower absenteeism (J22) |
| healthier students (I19) | higher cognitive functioning (D87) |
| higher cognitive functioning (D87) | enhanced educational outcomes (I26) |
| burden of disease in low-income regions (I14) | barrier to economic growth (O17) |