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Corresponding Author:
Mduduzi Biyase, University of Johannesburg, School of Economics, South Africa

Coauthors:
Mokgadi Maleka, School of Economics, University of Johannesburg, South Africa

Life Expectancy and Economic Growth: Evidence from the Southern African Development Community

Volume 72 - Issue 3, August 2019
(pp. 351-366)
JEL classification: O11, O47
Keywords: SADC, Endogeneity, Economic Growth, Fixed Effect, Life Expectancy

Abstract

The objective of this paper is to examine the association between life expectancy and economic growth in a sample of 10 Southern African Development Community members for the period 1985-2017. To account for unobserved country-level heterogeneity we employ the fixed effect estimator. We also use fixed effects two-stage least squares (FE-2SLS) estimator to account for a possible endogeneity bias due to reverse causation between life expectancy and economic growth. Using the fixed effect we find that life expectancy, democracy, and population have the expected positive impact on economic growth. The results are robust to addressing the potential reverse causality between life expectancy and economic growth, controlling for additional variables (such as inflation, trade openness, and government expenditure), and altering the sample of countries (i.e. excluding South Africa from the sample) in the estimation. The estimates from this paper suggest that improving health conditions in the Southern African Development Community can be effective and should continue to be a major focus of policy makers in this region and other developing regions.

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