There is a two-way relation between health and development. On the one hand, economic development tends to improve health status. On the other hand better health contributes to economic development. However, development alone cannot reduce morbidity (sickness) and mortality (death). Special programmes in nutrition, health care and environmental sanitation also are needed.

The World Health Organisation (WHO), the U.N. agency responsible for programmes to improve health standards defines health as a “state of complete physical, mental and social well being�. In general health simply means the absence of disease and infirmity.

Health increases human potentialities of all kinds. While everyone can benefit from better health in the present, improved health for the young will lead to a healthier population in the future.

Like education health services improve the quality of human resources, both now and in the future. Better health for workers can provide direct and immediate benefits by increasing their strength, staminas and ability to concentrate on their jobs. Better child health and nutrition promote future productivity growth directly by helping children develop into stronger and heathier adults. In addition they make indirect contribution by improving children’s ability to acquire productive skills and attitudes through schooling. In general healthy, well-fed children have higher attendance rates and are able to concentrate on their studies.

While educational expenditures increase only the quality of human resources, health expenditures increase their quantity in the future by lengthening expected working life. These two types of expenditure complement each other since, ceteris paribus, returns to education will be higher if people can work harder and longer, in which case their total income will increase.

However, it is very difficult to measure the economic effects of better health. In LDCs like India where marginal productivity of labour is very low, the production benefits of an extended working life are necessarily small. The qualitative effects of health expenditure (increased workers productivity and earnings) also are difficult to measure because increases in productivity or earnings attributable to improvement in health may be difficult to identify.

In addition to increasing the quantity and improving the quality of/human resources, health expenditures can increase the availability or productivity of non-human resources. For example improved control of parasitic conditions increase the productivity of land and natural resources and increase the output of food and industrial raw materials.

Finally, better health can save money spent on curative health care. This frees resources for other (more productive) uses.

However, health improvement has one negative consequence. By reducing the death rates it increases population growth. It is also possible that a decline in the death rate encourages drop in fertility, which slows down the growth rate of population.