The Econometric Analysis of Health Expenditure Inflow with Economic Growth in India

There is an association of health expenditure inflow with economic performance. Health expenditure inflow can result in better provision of services opportunities, which can strengthen health expenditure inflow and improve productivity, thereby contributing to economic performance. It is therefore important to assess the phenomenon of high economic growth in a country. Based on economic growth the study empirically examines the linkage of health expenditure inflow with economic growth. The proxy variables for economic growth are taken such as GDP using data collected from a secondary source like World Bank Data (WBD). The model, Vector Error Correction Model has been used to find the long-run and short-run causality among the variables where the Johansen Co-integration test for the longrun causality and short-run causality Wald test has been applied. Wald tests to conclude the objective of the study. The data span for the study is from 2000 to 2021. Wald tests show the bidirectional causal relationship in all variables. Therefore, this study concludes by recommending, the strategy to improve health expenditure inflow to improve the GDP. The findings from the Johansen Co-integration test indicated that there excises a long-run relationship between India’s health expenditure and GDP. Furthermore, the Granger causality test detected bi-directional causality from GDP to health expenditure. These results were further confirmed by findings from the impulse response function. This means that India represents an example of a developing economy where the size of health expenditure expands in the process of economic transformation. And also the VECM model has been used