Public Health Financing and Population Health: What Role Do Institutions Play?

ABSTRACT This study investigates the multifaceted interactions among public health financing, institutions, and population health. It also sought to determine whether the efficacy of government health interventions to reduce child mortality and improve life expectancy in Africa's most populous country had been hampered by its institutional framework. The research analyzed the links among institutional, socioeconomic, and health variables using the autoregressive distributed lag estimator across a 37‐year period (1984–2020). The findings show that short‐term public health spending in Nigeria has a significant negative effect on health outcomes, whereas long‐term spending has a significant positive effect. Although public health financing significantly impacted long‐run life expectancy, its short‐run impact is statistically insignificant. Moreover, public health financing is positively linked with lower infant mortality in the long run but directly associated with higher rates in the short run. It further discovered that weak institutional framework is responsible for low life expectancy and high infant mortality. Institutions exert an unconditional significant negative impact on short‐ and long‐term health outcomes. Findings also show that both the short‐ and long‐term net effects of government health financing and institutions on the health outcomes are negative and statistically significant. So, institutions and public health financing are substitutes, with institutions unable to adequately improve their role in the public finance–health outcomes relations. Furthermore, the thresholds at which short‐ and long‐term institutional settings will modulate direct links between public finance and health outcomes are 5.01 and 2.62, respectively. Hence, the empirical findings validate the defective nature of the Nigerian institutional settings. Policy prescriptions for improving health outcomes are recommended based on the findings.