Infectious Diseases and Economic Development

Abstract

This dissertation contains three essays analyzing how disease (particularly communicable disease) and development interact. The first chapter explores how TseTse-transmitted Trypanosomiasis influenced African development. The second essay seeks to understand why the HIV epidemic declined in Uganda. The third study investigates the effect of population health on foreign direct investment. In the first essay, I examine the effect of the TseTse fly on African historical development. African ethnicities in TseTse suitable areas are found to be more reliant on indigenous slavery, shifting agriculture and are less urbanized as of the 19th century. TseTse suitability does not predict such correlations outside of Africa, where the fly does not exist. Africa would have been more similar to Eurasia in the absence of the fly. Current economic performance appears to be affected by the fly through its effect on historical institutions. In the second essay, David Cutler and I study how and why the HIV epidemic declined in Uganda. We identify reduced pre-marital sexual activity among young women as the most important factor leading to the decline in HIV. We next explore why young women would have changed their behavior. Using two-stage least-squares and difference-in-difference estimators, we find increases in girls’ secondary school enrollment, brought about by a targeted education policy, explains half the reduction in HIV in this cohort and approximately one-third of the overall decline. In the last essay, David Bloom, David Canning and I investigate the role of population health on foreign direct investment (FDI). We conduct a panel data analysis of 74 industrialized and developing countries over 1980-2000. Our main finding is that gross inflows of FDI are positively and significantly influenced by low population health in low- and middle-income countries. Our estimates suggest that raising life expectancy by one year increases gross FDI inflows by 9%, after controlling for other relevant variables. These findings are consistent with the view that health is an integral component of human capital for developing countries.