TOTAL FACTOR PRODUCTIVITY GROWTH IN SUB-SAHARAN AFRICA: DOES HEALTH REALLY MATTERS?

Back to Page Authors: Yetunde Adegoke, Josue Mbonigaba

---

Keywords: health factors, non-health factors, TFP growth, SSA

---

Abstract: The abysmally low TFP growth in SSA countries has pushed economists into a serious dilemma of explaining various determinants of TFP growth in the region. TFP growth tends to be lower in SSA countries than elsewhere, which has, therefore, necessitated an intense debate of the role of health in explaining TFP growth. This present study investigated the health and non-health determinants of TFP growth for the panel of 25 Sub-Saharan African countries. The Dynamic Panel Generalized Method of Moments (DP-GMM) was employed to analyze the data on Health expenditure per capita, Life expectancy at birth, HIV Prevalence rate and other non-health factors. The result of the analysis revealed that health expenditure per capita and HIV prevalence rate (15-49years) significantly determined the level of TFP. Life expectancy at birth did not determine TFP growth in SSA. Also, gross capital formation and foreign direct Investment (FDI) have a significant effect on the level of TFP. Labor force participation and Control of Corruption did not determine TFP growth in SSA. The study, therefore, recommends that SSA governments should increase the expenditure on health for improvement in TFP growth and intensify the fight against HIV with the aim of achieving a society without AIDS. The extension of retirement age among some categories of workers in some SSA countries should be carefully guided because the productivity of such workers above the approved 60 years may not matter for TFP growth in SSA countries. The fight against corruption should be rigorously taken so that corruption could have a significant effect on TFP growth in SSA.

---