Causality Between Carbon Emissions, Temperature Changes, and Health Expenditures: A Comparative Panel Approach with Environmental and Economic Indicators

This study investigates the causal relationships between carbon emissions, temperature increases, and health expenditures within the framework of environmental and economic indicators. With the accelerating global impacts of climate change and rising carbon emissions, understanding their effects on public health systems has become critical. This research evaluates these interdependencies using panel causality models, dividing 115 countries into two groups—developing and developed—based on Gross National Income (GNI) per capita (PPP) and health expenditures as a percentage of GDP. Dumitrescu–Hurlin panel causality analysis was applied to examine bidirectional relationships among key indicators, including population density, temperature changes, carbon emissions, GNI, and health expenditures. The findings reveal that population density has significant causal effects on both temperature changes and carbon emissions, while carbon emissions also influence health expenditures. Moreover, the causality from population density to temperature changes is stronger in developed countries, whereas the impact of temperature changes on health expenditures is more pronounced in developing countries. These results highlight the need to strengthen climate adaptation capacities in the health systems of developing countries and implement stricter carbon emission reduction policies in developed nations as essential strategies to address these interconnected challenges.