Background and aims: Health is one of the most important assets of a man that has allowed him to develop his full potential. If this capital is eroded or not fully developed, it could be weakened human physically and mentally. On the other hand, the phenomenon of unemployment is a social and economic hardship that fallowed several negative effects and people personal life are strongly influenced. Accordingly, this study examines the causality between unemployment and health in Iran. Methods: This research is doing a causal-analysis by using Toda - Yamamoto and Johansen-Juselius methods over the period of first quarter of 1995 to fourth quarter of 2013 for the country of Iran. Also, the level of significant is 5 percent.
Results: There is a two-way causality between unemployment and health. Also, one percent increase in unemployment, decreases the health by 6.84 percent. Accordingly one percent increase in the private health expenditure lead to 0.14 percent decrease in unemployment.
Conclusion: Given the significant cross negative impact of health on unemployment and vice versa, it is recommended to invest in the health sector such as health insurance and hospital, particularly in disadvantaged areas, to provide workforce health and reduce unemployment and provide community health with appropriate policies to reduce unemployment and increase income.
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