Dynamics of Oil Receipts, Health Expenditure and Health Quality in Nigeria

Abstract

The determinant of health status has received an extensive attention in the literature for a large number of studies across the world. Empirical studies have explored the relationship between health expenditure and health status; however, the dynamic relationship amongst oil receipts, health expenditure and health quality is an empirical issue that has received little attention particularly in Nigeria. This study investigated the tripartite relationship among oil receipts, health expenditure on health status in Nigeria using pairwise granger causality test and autoregressive distributive lag approach (ARDL). The study shows that unidirectional causality runs from oil receipts to health expenditure and health quality. There is also bidirectional causality between health expenditure and health quality. The cointegration result revealed there is long run relationship among these variables. This study also found that oil revenue and health expenditure have negative and significant impact on child mortality rate but positive and significant effect on life expectancy. This finding obviously would facilitate the policies that will improve health sector in Nigeria.

Keywords: Oil Receipts, Health Expenditure, Health Quality, Granger Causality, ARDL, Nigeria

DOI: 10.7176/JRDM/67-06

Publication date:July 31^st 2020