The Effect of Health Expenditure on Labor Productivity in Iran in 2005 -2013

Increase human capital and quality of human resources by increase health level one of the important factors for economic growth, that in constant level of inputs increase productivity. This study uses panel data of 30 provinces over 2005 -2013 that obtained from regional data of statistical center of Iran, estimate Mankiw, Romer and Weil model by generalized method of moments and panel data. Data analysis was performed using Spss22 and Eviews8 software. The results show that public health expenditures have a more effect on the labor productivity than private health expenditures, so that for 100 rials the increase in private and public health expenditures, respectively, was significantly more than 0.75 rials and 27.4 Rial increases. by considering that the private health expenditure has treatment aspect and public expenditure has sanitary aspect, and because the heath expenditure has high cost for some of household, government must reduce the cost of health so that increase the labor productivity.