Ahmet Cager, Dilber Caglar Onbasıoglu
Pharmaceutical industry is an important source of growth in many countries. This paper investigates the effect of pharmaceutical spending on Gross Domestic Product (GDP) in North Cyprus economy over the period 2008 and 2018. In the process of carrying out this research work, various variables such as gross domestic product (and per capita), current health expenditure per capita, external health expenditure per capita, life expectancy, population, gross capital formation, pharmaceutical expenditure, import are adopted and the Augmented Dickey Fuller test (ADF) for unit root test, Correlation analysis, Bound test and Autoregressive Distributed Lag Model (ARDL) are used in the estimation of the pharmaceutical expenditure on economy. The results refers that the external health expenditure per capita and gross capital formation was statistically significant to the Gross Domestic Product Per Head (GDDPC) in North Cyprus and there is unidirectional causality from Import (IMP) through the Gross Domestic Product (GDP).