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HealthConnections: How Does Health Affect the Economy?


For years, economists talked about health and economics as something of a one-way street: Countries with strong economic growth would produce better health outcomes. But now, thinking is morphing into a two-way model: Better economic conditions can help health outcomes, and healthier people benefit themselves and regional, state and national economies.

"Health is very similar to education, in that it's a form of human capital investment," said Dr. Katie Cahill, associate director of the Baker Center in Knoxville. "Economists are actually finding now that perhaps even more so than education, better health is linked to greater productivity across occupational settings."

Correspondingly, worse health produces a drag on local and state economies. Tennesseans are more likely than the national average to miss work or prematurely drop out of the workforce entirely because of health problems. 

Cahill helped author a paper examing the link between health and economics published as part of the Boyd Center for Business and Economic Research's annual report to the governor's office.

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