Abstract:
Economic growth is important as it measures the prosperity of a nation which indeed
increases the output per person and factors like human capital, physical capital and
technological change, which are the main drivers towards achieving economic growth.
Kenya’s Vision projected an economic growth rate of 10 per cent per annum from 2008
to 2030, which is yet to be achieved to date. The purpose of this study was to establish
effect of residents’ health indicators on economic growth in Kenya. The specific
objectives of the study were to determine the effect of: healthcare expenditure, life
expectancy, nutrition status and access to health services on economic growth in Kenya.
The study adopted the endogenous growth theory and incorporated key health
indicators into the model as a function of human capital. Research design employed
was explanatory research design and it relied on secondary data from World Bank from
1987 to 2018. The study employed Johnsen co-integration test, Error Correction and
multiple regression models. The results indicated that the coefficient of nutrition status
was -5.6256, p 0 . 042 0 . 05 , which was negative and significant at 5 percent level
of significance. This implied that in the long run, an increase by one percent of
coefficient nutrition status would result in a reduction of GDP growth rate by 5.6256
percent. Applying regression model, the results revealed that coefficient of life
expectancy was 1.3292, p 0 . 017 0 . 05 which was positive and significant at 5
percent level. This implied that for every one percent increase in coefficient of life
expectancy, GDP growth rate could increase by 1.3292 percent. Coefficient of nutrition
status was -2.072, p 0 . 019 0 . 05 which was negative and significant at 5 percent
level. This implied that for every one percent increase in coefficient of nutrition status,
GDP growth rate would fall by 2.072 percent. Considering that increased life
expectancy had direct effect on increase in economic growth rate, Kenyan government
could put in place policies promoting citizen’s health. Suitable social sector policies
and government interventions are required to increase life expectancy and
consequently, the economic growth rate. Furthermore, there is also a need to involve
health human force in macro and micro policy-makings and critically examine other
determinant of health care expenditure.
