Using the most recent data from Tanzania, we investigate the impacts of district-level health and
education expenditures on marginal productivities of agricultural inputs and overall production.
We use a covariance structural model combined with a mixed linear model to account for the
endogeneity of social outcomes and technological heterogeneity across districts. Our results
confirm the significance of government social expenditures in human capital formation as
measured through health and education indicators and their effects on agricultural productivity.
Indeed, the marginal productivities of inputs (labor in particular) respond significantly and
positively to health and education outcomes, especially considered jointly. The impacts also
seem to be a function of the type of health constraint, with short-term health factors such as
malaria and diarrhea impacting productivity from seeds and fertilizer while longer-term health
constraints seem to have greater impacts on labor quality and land productivity. Our results
also confirm the importance of considering intra-country heterogeneity as well as climaterelated
constraints, as the results show that annual precipitation has a signification impact on
production for all specifications.