Unequal Wealth, Unequal Health: The Health Cost of Income Gaps in South Asian Countries

Abstract

The study aims to assess the long-run influence of income inequality, GDP growth, and public health expenditures on people’s health status in the selected South Asian countries. Before estimating the coefficients, the analysis thoroughly examined the stationarity of the series and the presence of long-term cointegration among the selected model variables. Finally, the analysis employed Fully Modified Ordinary Least Squares (FMOLS) to panel data covering the period 2000 to 2023. Empirical findings show that income inequality deteriorates people’s health. More specifically, an increase in income inequality by one per cent deteriorates an individual’s health by approximately 1.42 per cent. On the contrary, individuals’ economic well-being and the public’s spending on health improve people’s health by about 0.511 and 0.321, respectively. The analysis recommends a public policy that uplifts the poor and reduces the economic gap between the poor and the rich.