The burden of disease and economic growth: The nonlinear effect of population age structure

TL;DR

This study finds that the impact of disease on economic growth is less severe in older populations compared to younger ones.

Contribution

The study introduces a nonlinear effect of population age structure on the relationship between disease burden and economic growth.

Findings

Burden of Disease negatively affects economic growth regardless of disease type.

The negative impact of disease on growth diminishes with an older population.

Old dependency ratio effectively divides countries into groups for analysis.

Abstract

This study aims to detangle the impact of health on economic growth as empirical evidence shows a mixture of findings. We use data on the Burden of Disease (BoD) from the Institute of Health Metric Evaluation (IHME) to measure health capital and the economic data of 87 countries from 1990 to 2018. Using panel threshold regression, this study shows that the old dependency ratio is a good measure of the threshold variable, which divides the country groups into four. The BoD, whether it comes from communicable diseases (CD), non-communicable diseases (NCD), or injuries, has a negative impact on economic growth. However, the negative relation is somewhat diminished as the population gets older, demonstrating that the BoD's impact on economic growth is less pronounced for the older population than the younger population.