The impact of environmental quality on public health expenditure in Malaysia

Health is one important factor in the development of human capital. Good health will
lead to increased levels of productivity. This study was conducted to examine the cointegration
between environmental quality and socio economic factor for national health expenditure. This study used secondary data from the World Bank Indicators and the Department of Statistics Malaysia. This analysis employs annual time series data on real per capita Health Expenditure (HE), real per capita Gross Domestic Product (GDP), Carbon Dioxide (CO2), Nitrogen Dioxide (NO2) and Sulphur Dioxide (SO2) emission in metric tonnes per capita, Fertility Rate (FR), Mortality Rate (MR) infant per 1,000 live births. The data were obtained from World Bank Development Indicator (WDI) and spanned over the period 1970 – 2013. This data was analyzed using the
software E-views and the methodology applied was a co-integration and ARDL approach in order to explore the possibility of estimating both short and long run impacts of environmental quality. The study found that GDP, CO2, MR, FR, NO2 and SO2 could be treated as having relationship which health expenditure in the long run in Malaysia. SO2, fertility and infant mortality rate showed a significant factor in the country's health expenditures affect substantially. The new generation is an important element in ensuring the continuance and sustainability of national development in the future.