The effect of health capital on labour productivity in Nigeria from 1970 to 2013: a standard Neo-Classical growth framework approach

Ephraim Ikechukwu Ugwu, Federal University Oye-Ekiti
Jonas Igwe, University of Nigeria, Nsukka

This study evaluates the effect of health capital on labour productivity in Nigeria from 1970 to 2013, using the standard neo-classical growth framework approach. The study adopts Ordinary Least Square (OLS) technique, Cointegration and Granger Causality test procedures, for estimation. The Unit root test result conducted shows that the variables under consideration, PERCAPITA, D(HEALTH), EDUCATIO, AGRICULT,EXCHR and INF are stationary and integrated of order one I(1) at 5% level of significance in the ADF statistics. The cointegration test result indicates at most five cointegrating equations. The Granger causality test result conducted indicates a bilateral causality existing between D(HEALTH) and PERCAPITA income. A unilateral causality exits from EDUCATIO to PERCAPITA. There is unilateral causality existing between PERCAPITA and AGRICULT variable. There is no direction of causality existing between D (LABFORCE) and PERCAPITA. The OLS result shows that an educated, healthy-labour force are among the key determinants of labour productivity in Nigeria.