A Virus’ Effect on Growth: HIV’s Effect on African GDP Growth Rates

Abstract

The sexually transmitted disease, HIV, is a vicious virus with no cure whose prevalence spans the entire globe, with daily diagnoses in every country. Those most affected with the terrors of the sickness lie in its birthplace of Africa, where one in ten carry the strain; and in some African countries more than a quarter of the population is HIV positive (Hacker, 2002). Compared to other world regions, Africa has a severe health crisis spawned from this relentless and incurable sickness. However, while the severity of the virus is widely known, its economic implications are not as apparent. It has been wondered, and seems intuitively correct, that a virus this deadly and prominent would have major implications on the level of output amongst highly infected countries (Dixon and McDonald, 2002). After all, a virus of this size would seem to affect numerous economic stimulating activities, such as the savings rate, labor force participation and worker determination. The expectation is to find HIV prevalence as having a negative and significant correlation to long run, per capita GDP growth rates in Africa; however, given the data, a statistical conclusion cannot be made to prove this occurrence. Instead, through the use of linear regression, economic data infers HIV prevalence has little to no effect on Africa’s sluggish GDP growth.