Impact Of Public Expenditure on Health Outcomes in Tamil Nadu

Abstract

The level of public spending has emerged as one of the most significant measures of development for the priorities of the elected government. Public expenditure is essential to achieving the government's development objectives. Government of India committed to spend minimum 3 percent of GDP for public health. However, until now the goal has not been realized which forces the sizable number of poor people to spend from their pockets. Both union and state governments together spend just about 1 percent of GDP for health.  Analyzing the impact of public spending on health outcomes in Tamil Nadu is the study's main objective. Nonetheless, the concerning disparity in our health care is evident from health indices such as the rate of malnourishment, life expectancy at birth, sex ratio, maternal mortality rate, and infant mortality rate. Health spending by the Government in India accounts for less than 1 percent of GDP and this also brought down the basic health indicators and poor health infrastructure such as reductions in dispensaries, number of beds, doctors per patient and number of primary health centres followed by sub-centres. The study examined the impacts of public spending on health outcomes and its results in Tamil Nadu with relevant indicators using the Vector Error Correction model. The result revealed that public expenditure has positive association with dispensaries, number of doctors and number of nurses, meaning that increase in public expenditure. The study concludes that the most of the health indicators respond positively for improved public spending on health infrastructure like primary health centres, preventive health, maternity care, nutrition and so on. Hence, both efficiency level of public spending as well as inadequacy of public spending have empirically analysed. Additionally, it is noted that a number of health indicators are positively impacted by public spending on health.