Subject. This article studies the impact of healthcare expenditures on economic development. Objectives. The article aims to conduct a panel analysis of the relationship between healthcare costs and the GRP per capita growth rates depending on the human capital level in the regions of Russia for the periods from 2005 to 2013 and 2008 to 2018. Methods. For the study, we used econometric modeling based on a fixed-effects threshold regression. Results. The article presents the results of the calculation of two threshold regression regimes (above and below the threshold) and determines the contribution of healthcare expenditures to the regional growth rates. Conclusions. Regions with maximum threshold values are characterized by a higher quality of medical care and up-to-date infrastructure. Under limited financial resources, a partial reallocation of health expenditures to other regions could contribute to improving the health of the population and the goods and services production ramping-up.
Keywords: panel fixed effects threshold regression, economic growth, health expenditures, Russian regions
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