JOURNAL OF APPLIED BUSINESS AND ECONOMICS
Trade and Health Linkages: A Global Panel Data Analysis Using the Gravity Model
Author(s): Pallavi Panda
Citation: Pallavi Panda, (2020) "Trade and Health Linkages: A Global Panel Data Analysis Using the Gravity Model," Journal of Applied Business and Economics, Vol. 22, Iss.5, pp. 111-122
Article Type: Research paper
Publisher: North American Business Press
Abstract:
This paper provides empirical evidence on the effect of trade openness on child health using the data from 171 countries between the mid-1990s to mid-2000s. Using an instrumental variable approach with a geographic gravity model framework, this study finds that a 1% increase in openness leads to a 0.2% decrease in infant mortality rates across countries, which at the sample mean is about 8 infant deaths per 1000 live births. The result is robust to country-specific time-invariant heterogeneity as well as outliers. The main channels of operation seem to be through increasing incomes, increasing health expenditures, and decreasing inequality.