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Population Health and Foreign Direct Investment: Does Poor Health Signal Poor Government Effectiveness?

dc.contributor.authorAjay Tandon
dc.date.accessioned2015-01-30T14:44:28Z
dc.date.available2015-01-30T14:44:28Z
dc.date.issued2005-01-01
dc.identifier.urihttp://hdl.handle.net/11540/1789
dc.description.abstractThis policy brief argues that poor levels of population health can deter foreign direct investment because they can act as potent signals of institutional weaknesses and, more broadly, of lower levels of government effectiveness. The outbreak of severe acute respiratory syndrome (SARS) in 2003 in Asia brought into sharp focus the linkages between health and the macroeconomy. The economic impact of SARS was largely driven by fear and uncertainty, resulting in sharp declines in tourism and consumer confidence. Foreign direct investment (FDI) in SARS affected countries such as People's Republic of China saw a significant decline in the immediate aftermath of the outbreak. The decline in FDI, however, did not last very long: the numbers rebounded after a lag period. Nevertheless, the SARS outbreak has brought to surface the following question: if episodic health "shocks" such as SARS can put a brake on FDI and trigger capital flight, what might be the consequences of high levels of prevalence of more endemic communicable diseases for international investment?1 From the perspective of FDI, a health shock such as SARS is likely to have economic effects akin to those seen after a political shock such as a revolution or an assassination. This is quite different from the effects of widespread endemic prevalence of other communicable diseases such as HIV/AIDS, malaria, and tuberculosis. The latter signify low levels of human capital, lower labor productivity, higher absenteeism, and likely higher costs of operations due to health-related expenditures. More generally, widespread disease prevalence contributes to the perception of operational risk in the investment climate of a country. And, as is argued in this policy brief, poor levels of population health can deter FDI because they can act as potent signals of institutional weaknesses and, more broadly, of lower levels of government effectiveness.
dc.languageEnglish
dc.publisherAsian Development Bank
dc.rightsCC BY 3.0 IGO
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo
dc.titlePopulation Health and Foreign Direct Investment: Does Poor Health Signal Poor Government Effectiveness?
dc.typeWorking Papers
dc.subject.expertWorld Health Organization
dc.subject.expertUrban Health Services
dc.subject.expertRural Health Services
dc.subject.expertNutrition and Health Care
dc.subject.expertHealth Aspects of Poverty
dc.subject.expertHealth and Hygiene and the Poor
dc.subject.expertEducation, Health and Social Protection
dc.subject.expertAccess to Health Care
dc.subject.expertSocial Aspects Of Poverty
dc.subject.adbDisease Control
dc.subject.adbOccupational Hygiene
dc.subject.adbMedical Services
dc.subject.adbHealth Costs
dc.subject.adbSanitation
dc.subject.adbDiseases
dc.subject.adbWater Quality
dc.subject.adbRespiratory Diseases
dc.subject.adbHealth Indicators
dc.subject.adbDisadvantaged Groups
dc.subject.adbDisadvantaged Groups
dc.subject.naturalCost of medical care
dc.subject.naturalHealth status indicators
dc.subject.naturalSanitation services
dc.subject.naturalSickness
dc.subject.naturalIllness
dc.subject.naturalPrevention of disease
dc.subject.naturalHealth status indicators
dc.subject.naturalCost and standard of living
dc.title.seriesERD Policy Briefs
dc.title.volumeno 33
dc.contributor.imprintAsian Development Bank
oar.themeHealth
oar.themePoverty
oar.adminregionAsia and the Pacific Region
oar.countryBangladesh
oar.countryBhutan
oar.countryIndia
oar.countryMaldives
oar.countryNepal
oar.countrySri Lanka
oar.countryBrunei Darussalam
oar.countryCambodia
oar.countryIndonesia
oar.countryLao People's Democratic Republic
oar.countryMalaysia
oar.countryMyanmar
oar.countryPhilippines
oar.countrySingapore
oar.countryThailand
oar.countryViet Nam
oar.countryCook Islands
oar.countryFiji
oar.countryKiribati
oar.countryMarshall Islands
oar.countryMicronesia, Federated States of
oar.countryNauru
oar.countryPalau
oar.countryPapua New Guinea
oar.countrySamoa
oar.countrySolomon Islands
oar.countryTimor-Leste
oar.countryTonga
oar.countryTuvalu
oar.countryVanuatu
oar.countryAfghanistan
oar.countryArmenia
oar.countryAzerbaijan
oar.countryGeorgia
oar.countryKazakhstan
oar.countryKyrgyz Republic
oar.countryPakistan
oar.countryTajikistan
oar.countryTurkmenistan
oar.countryUzbekistan
oar.countryChina, People's Republic of
oar.countryHong Kong, China
oar.countryRepublic of Korea
oar.countryMongolia
oar.countryTaipei,China
oar.identifierOAR-001901
oar.authorTandon, Ajay
oar.importtrue
oar.googlescholar.linkpresenttrue


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  • Regional Economic Integration Working Paper Series
    The Asian Development Bank Working Paper Series on Regional Economic Integration focuses on topics relating to regional cooperation and integration in the areas of infrastructure and software, trade and investment, money and finance, and regional public goods. The series is a quick-disseminating, informal publication that seeks to provide information, generate discussion, and elicit comments.

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