Non-linear Impact of China's Economic Growth on the Health of Residents-An Empirical Study Based on TVP-FAVAR Model

Abstract

This paper uses the 74-dimensional macroeconomic data set from 2005 to 2017 as a sample to construct a TVP-FAVAR model to empirically study the impact of China's economic growth on the health of residents. The study found that China's economic growth has an impact on the health of residents and is transformed into changes in the macroeconomic environment that exhibit non-linear time-varying characteristics. Specifically: (1) During the period of steady economic growth, China's economic growth has caused a significant increase in population mortality rate, infectious disease mortality rate, medical expenses of residents, traffic accident rate, neonatal mortality rate, and tumor mortality rate; (2) During the financial crisis, the positive impact of economic growth on population mortality rate, infectious disease mortality rate, traffic accident rate, and neonatal mortality rate was significantly reduced, while the medical expenses of residents, tumor mortality rate, and cardiovascular morbidity rate and the incidence of mental illness rate has a more obvious inhibitory effect; (3) In the period of sustained economic downturn, the positive impact of economic growth on overall population mortality rate, infectious disease incidence rate, traffic accident rate, and neonatal mortality rate continues to decrease, still negatively affecting the incidence of mental illness rate and cardiovascular morbidity rate. In this paper, we suggested that the Chinese government further promote the transformation of the economic growth model in the new normal economic stage, increase public health fiscal expenditure, and realize an economic development evaluation system that is oriented toward improving the health of residents.

Keywords: D12; I18; O40; TVP-FAVAR; consumer spending; economic growth; high-dimensional macroeconomic data; the health of residents.