The macroeconomic determinants of health

Abstract

Why are some societies healthier than others? The consensus in development economics is that the health achievement of nations has to do with their levels of economic development. Higher per capita incomes, through steady and stable economic growth, increase a nation's capacity to purchase the necessary economic goods and services that promote health. In this paper, we review the conceptual and empirical linkages between poverty and poor health in both developing and developed countries. The empirical evidence is overwhelming that poverty, measured at the level of societies as well as individuals, is causally related to poor health of societies and individuals, respectively. Recent macroeconomic research has also drawn attention to the role of health as a form of human capital that is vital for achieving economic stability. In particular, attention has been drawn toward the ways in which unhealthy societies impede the process of economic development. However, the reciprocal connection between economic prosperity and improved health is neither automatic nor universal. Other features of society, such as the equality in the distribution of the national wealth, seem to matter as well for improving average population health and especially for reducing inequalities in health. We conclude by arguing for a need to reexamine the way in which health is conceptualized within the macroeconomic development framework.