Economic growth and disease in the OLG model: The HIV/AIDS case

Abstract

The aim of this paper is to provide an analysis of the impact of investment in health-policies on economic development. In order to do this, it is vital to bear in mind the fact that long-term economic growth is characterized by the interaction between the physical aspects of capital dynamics and the disease level in a developing country which lacks a financial market. The OLG model will be used in our analysis. Notice that the level of investment in health policies and disease management are one of the key variables of the model. It is, therefore, interesting to observe that an increase in capital may have either a direct or indirect impact on the stationary disease level and lead to effective prevention and disease control.