Abstract

One important socioeconomic factor that influences how much money a nation can devote to its healthcare system is health spending. This study examines the dynamic relationships between Pakistan's Gross Domestic Product in US dollars (GDPU), income inequality (GINI), the Human Development Index (HDI), and health expenditure (HEP) between 2000 and 2024. The HDI and its determinants, which are important markers of economic and developmental advancement, are the subject of the study. This study examines the individual and combined effects of these variables on healthcare spending using an Ordinary Least Squares (OLS) regression model. The results show that GDP has a major impact on healthcare spending, with higher economic growth being associated with higher health spending. On the other hand, the study finds a significant inverse relationship between HDI and health spending, indicating that nations with higher HDI typically have healthier populations and, consequently, lower healthcare costs. Furthermore, in this instance, HEP is not significantly impacted by the GINI Index, a measure of income inequality. The findings provide insightful information for policymakers and highlight the significance of both economic and social development factors in comprehending healthcare funding dynamics. This study emphasizes the need for better healthcare funding allocation, especially in Pakistan, where policies regarding healthcare spending are heavily influenced by social and economic development.