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The Effects of Resource Rent, Human Capital and Government Effectiveness on Government Health Expenditure in Organization of the Petroleum Exporting Countries

Author

Listed:
  • Ali Nikzadian

    (Department of Health Economics, Tarbiat Modares University, Tehran, Iran)

  • Lotfali Agheli

    (Economic Research Institute, Tarbiat Modares University, Tehran, Iran,)

  • Abbas Assari Arani

    (Faculty of Management and Economics, Tarbiat Modares University, Tehran, Iran.)

  • Hossein Sadeghi

    (Faculty of Management and Economics, Tarbiat Modares University, Tehran, Iran.)

Abstract

The low economic growth and lack of qualified institutions have led to a lower level of health in the resource-rich developing countries. This paper explores the effects of resource rent, human capital and government effectiveness on government health expenditure in Organization of the Petroleum Exporting Countries (OPEC). It uses Panel Fully Modified Least Squares (Panel-FMOLS) method in Eviews software over the period 2002 2015. Findings imply that the resource rent, human development index and government effectiveness influence directly the government expenditure on health, when the interactions between explanatory variables are ignored. However, the sign and magnitude of coefficients are changed, when interaction terms are included in regression models. The oil rents affect the healthcare sector in OPEC. Accordingly, the abundance of oil resources is not bad per se. Thus, the key determinant in the transformation of rents from oil resources into disaster or blessing is the government effectiveness across oil exporting countries.

Suggested Citation

  • Ali Nikzadian & Lotfali Agheli & Abbas Assari Arani & Hossein Sadeghi, 2019. "The Effects of Resource Rent, Human Capital and Government Effectiveness on Government Health Expenditure in Organization of the Petroleum Exporting Countries," International Journal of Energy Economics and Policy, Econjournals, vol. 9(2), pages 381-389.
    • Handle: RePEc:eco:journ2:2019-02-44
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    Cited by:

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    2. Laureti, Lucio & Costantiello, Alberto & Leogrande, Angelo, 2023. "The Role of Government Effectiveness in the Light of ESG Data at Global Level," MPRA Paper 115998, University Library of Munich, Germany.
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    More about this item

    Keywords

    Health; Resource rent; Panel-FMOLS;
    All these keywords.

    JEL classification:

    • C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection
    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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