Economic uncertainty and population health: insights from emerging markets and developing countries

Abstract

This study employs a Bayesian panel vector autoregressive model to examine the impact of economic uncertainty on public health, using an annual, country-level panel dataset of 103 emerging markets and developing countries spanning the years 1995 through 2019. The results from the full sample suggest that the immediate effects of heightened economic uncertainty on health are marginal, yet it may engender prolonged life expectancy and lowered mortality rates. The analysis unveils considerable heterogeneities among various country classifications. The health-enhancing effects of economic uncertainty are predominantly discernible in emerging markets, low-income and upper-middle-income countries. Additionally, a diminution in suicide rates, attributed to escalated economic uncertainty, is uniquely detected in upper-middle-income countries. Furthermore, economic growth and healthcare expenditure emerge as paramount determinants in bolstering overall population health, particularly in lower-middle-income countries. The detrimental effect of environmental pollution on health is more pronounced in emerging markets and middle-income nations. Excluding high-income countries, it is essential to emphasize the beneficial health outcomes resulting from financial development and globalization, as well as the deleterious effects of environmental pollution. Lastly, several policy implications aligned with the findings are outlined, providing a roadmap for decision-makers in these diverse economies to promote better health outcomes.