Population Aging, Health Investment and Economic Growth: Based on a Cross-Country Panel Data Analysis

With the economic development of various countries and the deepening of population aging, health plays an increasingly important role in the macro-economy. How to meet the growing health needs as well as promote the economy has captured the attention of the world. Therefore, whether health investment can promote economic growth is an important theoretical and practical issue. An extended Mankiw–Romer–Weil model (MRW) with human health capital and population aging is employed to examine the impact on economic growth from population aging and health investment. On the basis of the theoretical model, this paper uses the LSDV and TSLS methods to carry out an empirical study based on cross-country panel data during the period 2000–2016. The empirical results show that health investment plays a significant role in promoting economic growth, and there is an inverted U-shaped relationship between population aging and economic growth. The impacts on economic growth from health investment and population aging can weaken each other. In addition, this paper also finds that health investment structure and the proportion of government health investment to total government spending can affect economic growth.