Income Inequality and Public Health Status: The Role of Government Expenditures of Pakistan

Abstract

In developing countries like Pakistan, public health is often perceived as one of the main components of the welfare of society. This study aims to estimate the impact of income inequality on the health sector performance of Pakistan. Health performances are measured with the two leading indicators, life expectancy and infant mortality rate (IMR). The study employs the Autoregressive Distributed Lag (ARDL) model for co-integration analysis from 1980-2020. Furthermore, this study investigates the causality analysis with the help of the Toda Yamamoto Modified Wald test. The empirical result shows that income inequality has an adverse and significant impact on Pakistan's health performance measures. Moreover, the unidirectional relationship is confirmed between income inequality and life expectancy. The findings of the current work suggest that reducing income inequality would be an essential policy option for improving infant mortality conditions, life expectancy, and other poor health outcomes. Policymakers need to focus more on the equal distribution of income through the provision of public health infrastructure, and it may improve health performances over a more extended period.