Health and Economic Growth
The effects of longevity gains on human and physical capital accumulation as well as Total Factor Productivity explain the large impact on economic growth that was found in Aghion et al. (2011). The key to reconciling these results with those of Acemoglu and Johnson (2007) is convergence in life expectancy: Omitting the control for initial life expectancy inside growth regressions offsets the positive growth effect of the rapid improvement in health. However, there appears to be a weaker relationship between health and growth among OECD countries over the recent period, which reflects an age-specific productivity effect of health. Indeed, as of 1960, a large share of the growth of life expectancy at birth appears to be related to a reduction in mortality at old age, but it is mostly the decrease in the mortality of individuals aged forty or less that matters for economic growth.
KeywordsLife Expectancy Productivity Growth Total Factor Productivity OECD Country Physical Capital Accumulation
Unable to display preview. Download preview PDF.