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Macroeconomic Approaches to Identifying the Effects of Health on Output, Growth and Poverty

Macroeconomic Approaches to Identifying the Effects of Health on Output, Growth and Poverty Abstract: Microeconomic studies cannot, by definition, identify general equilibrium economic effects of changes in health. Macroeconomic analysis is needed for this, and the paper reviews three strands in the empirical literature, based respectively on cross‐country regression analysis, computable general equilibrium (CGE) modelling, and a mixture of microeconomic estimation and macroeconomic simulation. The first two strands have important drawbacks. Cross‐country regression is beset with the problem of finding valid instruments. CGE models tend to contain a large number of imposed parameters, making it hard to judge the robustness of simulation results. Mixing micro‐estimation with aggregative macro‐simulation appears most promising as this methodology allows both drawbacks to be avoided, at least in part. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png African Development Review Wiley

Macroeconomic Approaches to Identifying the Effects of Health on Output, Growth and Poverty

African Development Review , Volume 24 (4) – Dec 1, 2012

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References (25)

Publisher
Wiley
Copyright
© 2013 The Author. African Development Review © 2013 African Development Bank
ISSN
1017-6772
eISSN
1467-8268
DOI
10.1111/1467-8268.12008
Publisher site
See Article on Publisher Site

Abstract

Abstract: Microeconomic studies cannot, by definition, identify general equilibrium economic effects of changes in health. Macroeconomic analysis is needed for this, and the paper reviews three strands in the empirical literature, based respectively on cross‐country regression analysis, computable general equilibrium (CGE) modelling, and a mixture of microeconomic estimation and macroeconomic simulation. The first two strands have important drawbacks. Cross‐country regression is beset with the problem of finding valid instruments. CGE models tend to contain a large number of imposed parameters, making it hard to judge the robustness of simulation results. Mixing micro‐estimation with aggregative macro‐simulation appears most promising as this methodology allows both drawbacks to be avoided, at least in part.

Journal

African Development ReviewWiley

Published: Dec 1, 2012

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