Effect of Health Expenditure on Life Expectancy in Nigeria

Abstract

This paper examined the effect of health expenditure on life expectancy in Nigeria using time series data from 1990 to 2021 and the ARDL and ECM models.  The short-run analysis revealed that it would take 71% adjustment speed for the model to move from the short run to the long-run, indicating that health expenditure may take time to have an impact on life expectancy. The study found a negative relationship between health capital expenditure, health recurrent expenditure in the long run, while out-of-pocket health expenditure had a positive relationship with life expectancy. The study recommends that the Nigerian government should take action to address the negative correlation between health capital expenditure and life expectancy by allocating sufficient funding to the health sector and implementing policies such as tax incentives and subsidies to encourage citizens to invest more in their healthcare and reduce out-of-pocket expenses for essential healthcare service.