This paper reports estimates of the economic impact of HIV/AIDS in the Asian and Pacific region using a standard growth model. Following previous research on this issue, an economy wide aggregate production function is estimated with health capital as an input.
This paper reports estimates of the economic impact of HIV/AIDS in the Asian and Pacific region using a standard growth model. Following previous research on this issue, an economy wide aggregate production function is estimated with health capital as an input. HIV/AIDS is assumed to influence the accumulation of health capital proxied by a life expectancy shortfall measure. The model is estimated empirically using cross-country panel data spanning the period 1960–2000. Using a global sample, results indicate a negative impact of increasing HIV/AIDS prevalence on health capital and on economic growth. Using fairly conservative projections for HIV/AIDS prevalence, the model predicts a particularly large adverse impact on economic growth in Cambodia and Papua New Guinea.
