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Spending to Save? State Health Expenditure and Infant Mortality in India

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Sonia Bhalotra ()

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Abstract

There are severe inequalities in health in the world, poor health being concentrated amongst poor people in poor countries. Poor countries spend a much smaller share of national income on health expenditure than do richer countries. What potential lies in political or growth processes that raise this share? This depends upon how effective government health spending in developing countries is. Existing research presents little evidence of an impact on childhood mortality. Using specifications similar to those in the existing literature, this paper finds a similar result for India, which is that state health spending saves no lives. However, upon allowing lagged effects, controlling in a flexible way for trended unobservables and restricting the sample to rural households, a significant effect of health expenditure on infant mortality emerges, the long run elasticity being about -0.24. There are striking differences in the impact by social group. Slicing the data by gender, birth-order, religion, maternal and paternal education and maternal age at birth, I find the weakest effects in the most vulnerable groups (with the exception of a large effect for scheduled tribes).

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Paper provided by Department of Economics, University of Bristol, UK in its series The Centre for Market and Public Organisation with number 07/169.

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Length: 19 pages
Date of creation: Aug 2007
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Handle: RePEc:bri:cmpowp:07/169

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Related research
Keywords: public spending health poverty infant mortality India

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Find related papers by JEL classification:
I12 - Health, Education, and Welfare - - Health - - - Health Production
J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  2. David Cutler & Angus Deaton & Adriana Lleras-Muney, 2006. "The Determinants of Mortality," Journal of Economic Perspectives, American Economic Association, vol. 20(3), pages 97-120, Summer.
    Other versions:
    • David Cutler & Angus Deaton & Adriana Lleras-Muney, 2005. "The Determinants of Mortality," Working Papers 164, Princeton University, Woodrow Wilson School of Public and International Affairs, Research Program in Development Studies.. [Downloadable!]
    • David Cutler & Angus Deaton & Adriana Lleras-Muney, 2005. "The Determinants of Mortality," Working Papers 235, Princeton University, Woodrow Wilson School of Public and International Affairs, Center for Health and Wellbeing.. [Downloadable!]
    • David M. Cutler & Angus S. Deaton & Adriana Lleras-Muney, 2006. "The Determinants of Mortality," NBER Working Papers 11963, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  3. Sanjeev Gupta & Marijn Verhoeven & Erwin R. Tiongson, 2003. "Public spending on health care and the poor," Health Economics, John Wiley & Sons, Ltd., vol. 12(8), pages 685-696. [Downloadable!]
  4. Jonathan Temple, 1999. "The New Growth Evidence," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 112-156, March. [Downloadable!] (restricted)
  5. Bidani, Benu & Ravallion, Martin, 1997. "Decomposing social indicators using distributional data," Journal of Econometrics, Elsevier, vol. 77(1), pages 125-139, March. [Downloadable!] (restricted)
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  6. Rajkumar, Andrew Sunil & Swaroop, Vinaya, 2002. "Public spending and outcomes : does governance matter?," Policy Research Working Paper Series 2840, The World Bank. [Downloadable!]
  7. Sonia Bhalotra & Arthur van Soest, 2007. "Birth Spacing, Fertility and Neonatal Mortality in India:Dynamics, Frailty and Fecundity," The Centre for Market and Public Organisation 07/168, Department of Economics, University of Bristol, UK. [Downloadable!]
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  8. repec:att:wimass:1920418 is not listed on IDEAS
  9. Timothy Besley & Robin Burgess, 2002. "Can Labour Regulation Hinder Economic Performance? Evidence from India," STICERD - Development Economics Papers 33, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE. [Downloadable!]
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  10. Anand, Sudhir & Ravallion, Martin, 1993. "Human Development in Poor Countries: On the Role of Private Incomes and Public Services," Journal of Economic Perspectives, American Economic Association, vol. 7(1), pages 133-50, Winter. [Downloadable!] (restricted)
  11. Lanjouw, Peter & Ravallion, Martin, 1999. "Benefit Incidence, Public Spending Reforms, and the Timing of Program Capture," World Bank Economic Review, Oxford University Press, vol. 13(2), pages 257-73, May.
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  1. Sonia Bhalotra, 2007. "Fatal Fluctuations? Cyclicality in Infant Mortality in India," IZA Discussion Papers 3086, Institute for the Study of Labor (IZA). [Downloadable!]
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