Impact of income inequality on health and education in Africa: the long-run role of public spending with short-run dynamics

In this paper, we empirically investigate the long-run impact of income inequality on the pattern of major developmental indicators such as health and education in the African continent. We use an unbalanced panel dataset comprising 31 African countries for 40 years for the time period spanning 1980–2019. Our empirical results, used in conjunction with theoretical underpinnings, show that income inequality adversely affects health and education, both in the short run and in the long run. Interestingly, we also find that efficient state interventions in the form of investment in both health and education leads to unambiguous improvements in health and education outcomes in long run, although the curse of income disparity continues to have a negative effect on health and education in Africa in the short run. Apart from this, the present study also finds the threshold levels of government investments required to achieve positive outcomes in the long run in terms of health and educational in Africa, which are sustainable in the long run even in the presence of income inequality These results could be important for policymakers in Africa intending to boost health and education outcomes in a continent ridden by massive disparities in the income of its inhabitants.