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Mandar Oak
School of Economics, Faculty of Professions, the University of Adelaide
Economics, Econometrics & Finance

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Public Health Spending, Governance Quality and Poverty Alleviation Mohamad Komarudin; Mandar Oak
Economics and Finance in Indonesia Volume 66, Number 2, December 2020
Publisher : Institute for Economic and Social Research

Show Abstract | Download Original | Original Source | Check in Google Scholar | Full PDF (287.071 KB) | DOI: 10.47291/efi.v66i2.751

Abstract

Poverty alleviation has become the main priority program in most developing countries. This research empirically studies the correlation between public health spending, governance quality, and poverty alleviation in developing countries. The panel data were estimated via a random-effects (RE) model and robustness check using instrumental variables (IV) (two-stage least-squares [2SLS]) and first-difference generalized method of moments (GMM) because of the endogeneity problem. The results suggest that public health spending has a significant effect on reducing the poverty rate, and that countries with better governance tend to reduce poverty than countries with poor governance. Increasing public health spending by one percentage point may reduce poverty by 0.48 percentage points in countries with good governance supposing the governance quality influences public health spending. Conversely, in countries with poor governance, the poverty headcount ratio may decline by 1.375 percentage points when public health spending increases by one percentage point.
Co-Authors Mohamad Komarudin