This study examines the relationship between public health expenditure, economic growth, and health outcomes across eight northern states of India over the period of 2000–2021. Using panel data econometric techniques, the analysis employs Pooled Ordinary Least Squares, Random Effects, and Fixed Effects models, with Driscoll–Kraay standard errors to address heteroskedasticity, serial correlation, and cross-sectional dependence. To address potential endogeneity arising from unobserved common factors, an additional robustness check was conducted by estimating a two-way fixed effects model incorporating both state and year fixed effects. In addition, the Dumitrescu–Hurlin panel Granger causality approach is applied to explore the direction of causality among the variables. The core variables include infant mortality which is dependent variable while economic growth, and the growth rate of total public health expenditure are independent variables and gross fixed capital formation, urban population share, and mean years of education of women aged 20 and above are incorporated as control variables to mitigate model misspecification. The findings reveal that increases in public health expenditure, economic growth, and female education are associated with significant reductions in infant mortality. Urban population share, however, exhibits a positive association with IMR, reflecting the adverse health implications of rapid and unplanned urbanization in northern India. Gross fixed capital formation does not exert a statistically significant direct effect on infant mortality. The causality analysis indicates a bidirectional association between economic growth and infant mortality, suggesting mutual feedback effects, while a unidirectional causality runs from public health expenditure to infant mortality. These results underscore the critical role of sustained public investment in health, alongside inclusive economic growth and improvements in female education, in reducing infant mortality.
Para et al. (Wed,) studied this question.