Healthcare Expenditure and Its Impact on Economic Growth: A Case Study of Jordan

There is a near-unanimous view in current socioeconomic discourse that allocating public expenditure to health care expenditure is a top priority. In this article, we examine the causal relationship between health care expenditure and economic growth. This connection is multi-faceted, as it is a driver of economic growth and is a fundamental moral calling that requires greater resources to be spent on improving health care expenditure. Moreover, the importance comes from the fact that health care expenditure is part of broader economic policy. We therefore define this association in a broader perspective, taking into account the direction of causality, and then approach this association through an applied modeling approach. Our case study approach aims to explain these causal relationships through evidence. In doing so, we will show that the causal analysis we have performed can be applied to improve health care expenditure and thus improve economic growth more generally. The benefits are not only defined, but also clearly defined. The results indicate that, in general, the direction of the relationship is from health care expenditure to economic growth. This means that increasing the level of health care expenditure leads to a higher standard of living. Our empirical exercise shows that each 1% increase in health care expenditure will result in a 0.5% increase in gross domestic product (GDP). This study concludes that the country should pay attention to increasing the level of health care expenditure by allocating more funds to invest in health care infrastructure. In addition to the current pressing concerns about unemployment and slow economic growth, this study also suggests that improving health care expenditure will accelerate economic growth. The recommendations apply to any country with similar socio-political arrangements.