Document Type

Honors Project

Abstract

This paper quantifies the economic effect of the use of antiretroviral therapy as a frontline strategy to fight AIDS using data on 29 countries in Sub-­‐Saharan Africa. To this purpose, I use two-­‐stage least squares estimation defining both a health equation and an education and health capital-­‐augmented structural Solow growth equation. Through the introduction of antiretroviral therapy (ART) and HIV prevalence in the health equation, I indirectly link HIV and ART to economic growth. The results show that the HIV/AIDS epidemic reduces GDP per capita by 0.175% per marginal increase in HIV prevalence. ART increases GDP per capita by 0.048% per 1% increase in ART provision. On average, this represents a 0.5% higher GDP per capita per year attributable to ART in highly affected countries (HIV prevalence>20%).

Included in

Economics Commons

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