A Healthy Population is important for Economic Growth

AHealthy Population is important for Economic Growth

Ahealthy population in a country is described by the status of thehealth situations in a country or in the world. From an economicperspective, a healthy population is the one that has lessexpenditure on health related costs and has more outcomes in terms ofproductivity of the people. According to Bloom and Canning (1), ahealthy population produces healthy outcomes in different groups ofthe people in a country. A healthy population directly determines theincome of a country, the expenditure of a country and the economicoutput of a nation. This makes health a significant element ofmacroeconomic outcome of a country. The discussion in this paper willillustrate that a healthy population is an important variable in theeconomic growth and development of a country.

Lookingfrom the expenditure side of the economic variables, the healthstatus of the populations significantly affects governmentexpenditure. Therefore, a healthy population reduces the resourcesspent by the government to treat people and maintain their health.This is because the country spends less when people do not fall sickoften. In the world, America is one of the main countries that spendmore on health. According to the World Bank (1), America spent 17.9%of its GDP on health making it the highest health allocation in theworld for that year.

(WorldBank 1)

Thegraph shows the amount of GDP that countries spent on health for theyear 2011. The more expenditure the country allocates to healthcare,the better the health status of a country. If a country has a healthypopulation, the economic output will increase due to the increase inthe productivity of the people, among other macroeconomic variables(Curraiset al 12). The united stateseconomy has been on the recovery stage due a number of factors.However, one of the factors is the consistent high allocation of itsGDP to education as shown below.

Accordingto the World Bank (1), the U.S has dedicated over 17% of the GDP onhealth for the three reported years. This shows the extent ofexpenditure that a country incurs on the health sector. The impact ofa healthy population also reflects on lower allocation of investmentsinto building of hospitals and health care facilities. Bloom andCanning (1) argue that the investment that could have gone to thehealth sector has therefore been directed to other developmentalprojects in the country. In addition, the national budget is lessconstrained due to the reduced budgetary needs of the health sector(World Bank Release 1). The following shows the allocation of everydollar spent on health in the United States for the year 2011.


Inaddition, a healthy population impacts favorably into the country’seducation sector, manufacturing, government and related sectors aspeople and resources are more focused on them than in treatments. Theimpact of the health on these sectors directly affects the output ofa country by determining how the essential sectors perform.

Ahealthy population provides a vibrant human capital that is neededfor a country as a source of labor. Labor is a factor of productionand is essential in the coordination of other factors of productionof in any economy (Bloom and Canning 9). Taking an example of theUnited States, healthy population provides a vast source of employeesto the main sectors of the economy. One of the sectors isagriculture, which draws a lot of labor from the healthy populationby employing them to work in farms (Fleba 19). Moreover, agriculturealso contributes to the food security of the country which in turnleads to a healthy population. The same contribution replicates inall the sectors of the economy that contributes to the economic indexof the country.

Ahealthy population improves the performance of the economy byincreasing the performance of people at work. According to (Curraiset al (12), a healthy populationwill be keener at work and more energetic to perform highly than anunhealthy population. This means that healthy populations result inhigher economic production of the populations compared to unhealthypopulations.

Moreover,a healthy population will reflect positively on individual incomelevels of individuals in the economy. According to Fleba (21), thisis because healthy people will be able to work for themselves andgenerate income without reliance on the government grants. This meansthat a healthy population will increase the revenues of the countrydue to the increase in the country per capita income. The economywill be developed by the investment of these individual incomes thatare reflected in the savings done by the citizens. Healthy peoplehave substantive results by developing more innovative ways thatimprove the economy of the country by enhancing production fordomestic and foreign market (Curraiset al 42). This means thathealthy people are a recipe for a development of an economyespecially in economic output.

Ahealthy population is an important variable in the economic growthand development of a country. A healthy population reduces theexpenditure allocated to health and thus allows the country todevelop and grow. In addition, a healthy population increases thecapital for the economy and leads to increased income. By determiningthe important macroeconomic variables, a healthy population becomes asignificant determinant of economic growth.


Bloom,David and Canning, David.Population Health and Economic Growth.Web, Accessed, March 26, 2015,&lthttp://siteresources.worldbank.org/EXTPREMNET/Resources/489960-1338997241035/Growth_Commission_Working_Paper_24_Population_Health_Economic_Growth.pdf&gt

CMS,2015. National Health ExpenditureData. Web, Accessed, March 26, 2015,&lthttp://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/index.html?redirect=/NationalHealthExpendData/25_NHE_Fact_Sheet.asp#TopOfPage&gt

Currais,Luis.,Casasnovas,Lopez, &nbspand Berta,Rivera.Health and Economic Growth: Findings and Policy Implications.Massachusetts: MIT Press, 2005, Print

Fleba,Stephani. Costing of Health CareServices in Developing Countries: A Prerequisite forAffordability, Sustainability andEfficiency. New York: Peter Lang,2009, Print

WorldBank, 2015. Healthexpenditure,total (% of GDP).Web, Accessed, March 26, 2015,&lthttp://data.worldbank.org/indicator/SH.XPD.TOTL.ZS&gt