Determinants of Health Expenditure in GCC Countries: Exploring Environmental Quality,Economic Growth and Education Dynamics

Abstract

Health expenditure is vital for individuals and the state, reflecting a common concern for well-being, productivity and societal health. This study examines the factors that influence health expenditure in the context of environmental pollution, economic growth, ageing population, and educational attainment in the Gulf Cooperation Council (GCC) countries. It utilizes data from 2000 to 2022 for a panel of six nations and employs the augmented mean group (AMG) estimation, which is further cross-examined by the correlated common effects mean group (CCEMG) estimation and the Dumitrescu–Hurlin (D-H) Granger non-causality test. The AMG estimation findings reveal that CO² emissions significantly increase healthcare spending in the GCC nations, while economic growth helps mitigate it; education has no significant impact, and the small elderly population reflects ageing as an insignificant factor. This highlights an ageing pattern that diverges from global trends but mirrors regional realities. The robustness assessments, as determined by the CCEMG estimation and the D-H Granger non-causality test, also validate the AMG estimation outcomes. Our findings have important policy implications for policymakers that the GCC nations should strengthen environmental regulations, invest in green technologies, raise public awareness, integrate pollution data into health planning, enhance regional cooperation, leverage economic growth to improve healthcare efficiency, and reassess educational programmes to better influence health behaviours and spending.