IDEAS home Printed from https://ideas.repec.org/a/oup/oxecpp/v70y2018i2p353-374..html
   My bibliography  Save this article

The moral and fiscal implications of antiretroviral therapies for HIV in Africa

Author

Listed:
  • Paul Collier
  • Olivier Sterck

Abstract

Thanks to antiretroviral therapies (ART), people living with HIV (PLHIV) can now have a near-normal life at a cost of a few hundred dollars per year. We postulate that given this new low cost of maintaining lives, there is a moral duty to rescue those who are infected. This obligation creates a financial quasi-liability which for some African countries is comparable to their debt-to-GDP ratios. We construct a model to show that expenditure on prevention can pre-empt some of these liabilities. However, even with optimal prevention the quasi-liability is likely to remain too high to be affordable for a significant number of African countries. Extending the model to two players, we show that if the international community accepts part of the quasi-liability, as it does, it should finance a broadly equal share of prevention and treatment of future infections to mitigate moral hazard and avoid sub-optimal investment in prevention.

Suggested Citation

  • Paul Collier & Olivier Sterck, 2018. "The moral and fiscal implications of antiretroviral therapies for HIV in Africa," Oxford Economic Papers, Oxford University Press, vol. 70(2), pages 353-374.
    • Handle: RePEc:oup:oxecpp:v:70:y:2018:i:2:p:353-374.
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1093/oep/gpy001
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Jeffrey W Eaton & Leigh F Johnson & Joshua A Salomon & Till Bärnighausen & Eran Bendavid & Anna Bershteyn & David E Bloom & Valentina Cambiano & Christophe Fraser & Jan A C Hontelez & Salal Humair & D, 2012. "HIV Treatment as Prevention: Systematic Comparison of Mathematical Models of the Potential Impact of Antiretroviral Therapy on HIV Incidence in South Africa," PLOS Medicine, Public Library of Science, vol. 9(7), pages 1-20, July.
    2. Haacker, Markus, 2011. "HIV/AIDS as a Fiscal Liability," Proceedings of the German Development Economics Conference, Berlin 2011 35, Verein für Socialpolitik, Research Committee Development Economics.
    3. David Canning, 2006. "The Economics of HIV/AIDS in Low-Income Countries: The Case for Prevention," Journal of Economic Perspectives, American Economic Association, vol. 20(3), pages 121-142, Summer.
    4. Dolan, Paul & Tsuchiya, Aki, 2009. "The social welfare function and individual responsibility: Some theoretical issues and empirical evidence," Journal of Health Economics, Elsevier, vol. 28(1), pages 210-220, January.
    5. Nazim Belhocine & Mr. Salvatore Dell'Erba, 2013. "The Impact of Debt Sustainability and the Level of Debt on Emerging Markets Spreads," IMF Working Papers 2013/093, International Monetary Fund.
    6. Paul Dolan & Rebecca Shaw & Aki Tsuchiya & Alan Williams, 2005. "QALY maximisation and people's preferences: a methodological review of the literature," Health Economics, John Wiley & Sons, Ltd., vol. 14(2), pages 197-208, February.
    7. Canning, David & Bennathan, Esra, 2000. "The social rate of return on infrastructure investments," Policy Research Working Paper Series 2390, The World Bank.
    8. Elizabeth Lule & Markus Haacker, 2012. "The Fiscal Dimension of HIV/AIDS in Botswana, South Africa, Swaziland, and Uganda," World Bank Publications - Books, The World Bank Group, number 2382, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Judith Kabajulizi & Judith Kabajulizi & Mthuli Ncube, 2015. "The economy wide impact of HIV/AIDS and the funding dilemma in Africa: Evidence from a dynamic life cycle horizon," EcoMod2015 8563, EcoMod.
    2. Gori, Luca & Manfredi, Piero & Sodini, Mauro, 2021. "A Parsimonious Model Of Longevity, Fertility, Hiv Transmission And Development," Macroeconomic Dynamics, Cambridge University Press, vol. 25(5), pages 1155-1174, July.
    3. Kabajulizi, Judith & Ncube, Mthuli, 2017. "Financing HIV/AIDS responses in Africa: Impact evidence from Uganda," Journal of Policy Modeling, Elsevier, vol. 39(5), pages 843-860.
    4. Kjell Hausken & Mthuli Ncube, 2017. "Policy makers, the international community and the population in the prevention and treatment of diseases: case study on HIV/AIDS," Health Economics Review, Springer, vol. 7(1), pages 1-12, December.
    5. Richard Manning & Olivier Sterck, 2018. "Rethinking international and domestic financing for HIV in low†and middle†income countries," Development Policy Review, Overseas Development Institute, vol. 36(4), pages 433-444, July.
    6. Sterck, Olivier, 2016. "Natural resources and the spread of HIV/AIDS: Curse or blessing?," Social Science & Medicine, Elsevier, vol. 150(C), pages 271-278.
    7. Hausken, Kjell & Ncube, Mthuli, 2015. "Policy-Makers, the International Community and People Living with HIV: The Need for New Commitment Mechanisms," UiS Working Papers in Economics and Finance 2015/6, University of Stavanger.
    8. Remme, Michelle & Siapka, Mariana & Sterck, Olivier & Ncube, Mthuli & Watts, Charlotte & Vassall, Anna, 2016. "Financing the HIV response in sub-Saharan Africa from domestic sources: Moving beyond a normative approach," Social Science & Medicine, Elsevier, vol. 169(C), pages 66-76.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Attema, Arthur E. & L'Haridon, Olivier & van de Kuilen, Gijs, 2023. "Decomposing social risk preferences for health and wealth," Journal of Health Economics, Elsevier, vol. 90(C).
    2. Remme, Michelle & Siapka, Mariana & Sterck, Olivier & Ncube, Mthuli & Watts, Charlotte & Vassall, Anna, 2016. "Financing the HIV response in sub-Saharan Africa from domestic sources: Moving beyond a normative approach," Social Science & Medicine, Elsevier, vol. 169(C), pages 66-76.
    3. Mæstad, Ottar & Norheim, Ole Frithjof, 2012. "A universal preference for equality in health? Reasons to reconsider properties of applied social welfare functions," Social Science & Medicine, Elsevier, vol. 75(10), pages 1836-1843.
    4. Sterck, Olivier, 2016. "Natural resources and the spread of HIV/AIDS: Curse or blessing?," Social Science & Medicine, Elsevier, vol. 150(C), pages 271-278.
    5. Gu, Yuanyuan & Lancsar, Emily & Ghijben, Peter & Butler, James RG & Donaldson, Cam, 2015. "Attributes and weights in health care priority setting: A systematic review of what counts and to what extent," Social Science & Medicine, Elsevier, vol. 146(C), pages 41-52.
    6. Kruse, Tobias & Atkinson, Giles, 2022. "Understanding public support for international climate adaptation payments: Evidence from a choice experiment," Ecological Economics, Elsevier, vol. 194(C).
    7. Jeff Round & Mike Paulden, 2018. "Incorporating equity in economic evaluations: a multi-attribute equity state approach," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 19(4), pages 489-498, May.
    8. Matthew Abiodun Dada, 2015. "Theoretical Analysis of Microeconomic Effect of Public Investment," Asian Journal of Economic Modelling, Asian Economic and Social Society, vol. 3(1), pages 1-7, March.
    9. Matthew Robson & Miqdad Asaria & Richard Cookson & Aki Tsuchiya & Shehzad Ali, 2017. "Eliciting the Level of Health Inequality Aversion in England," Health Economics, John Wiley & Sons, Ltd., vol. 26(10), pages 1328-1334, October.
    10. Adler, Matthew D. & Ferranna, Maddalena & Hammitt, James K. & Treich, Nicolas, 2021. "Fair innings? The utilitarian and prioritarian value of risk reduction over a whole lifetime," Journal of Health Economics, Elsevier, vol. 75(C).
    11. Tappenden, P & Brazier, J & Ratcliffe, J, 2006. "Does the National Institute for Health and Clinical Excellence take account of factors such as uncertainty and equity as well as incremental cost-effectiveness in commissioning health care services? A," MPRA Paper 29772, University Library of Munich, Germany.
    12. Sawada Yasuyuki & Sugawara Shinya & Shoji Masahiro & Shinkai Naoko, 2014. "The Role of Infrastructure in Mitigating Poverty Dynamics: The Case of an Irrigation Project in Sri Lanka," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 14(3), pages 1-28, July.
    13. Maiorano, F. & Stern, J., 2007. "Institutions and investment in low and middle-income countries: the case of mobile communications," Working Papers 07/06, Department of Economics, City University London.
    14. Ward Romp & Jakob De Haan, 2007. "Public Capital and Economic Growth: A Critical Survey," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 8(S1), pages 6-52, April.
    15. Werner B. F. Brouwer & Frans F. H. Rutten, 2010. "The efficiency frontier approach to economic evaluation: will it help German policy making?," Health Economics, John Wiley & Sons, Ltd., vol. 19(10), pages 1128-1131, October.
    16. Joanna Mackiewicz-Łyziak, 2010. "Wpływ infrastruktury na produktywność w gospodarce Polski," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 3, pages 41-61.
    17. Áureo De Paula & Gil Shapira & Petra E. Todd, 2014. "How Beliefs About Hiv Status Affect Risky Behaviors: Evidence From Malawi," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 29(6), pages 944-964, September.
    18. Manfred Wiebelt & Rainer Schweickert & Clemens Breisinger & Marcus Böhme, 2011. "Oil revenues for public investment in Africa: targeting urban or rural areas?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 147(4), pages 745-770, November.
    19. Richardson, Jeff & Sinha, Kompal & Iezzi, Angelo & Maxwell, Aimee, 2012. "Maximising health versus sharing: Measuring preferences for the allocation of the health budget," Social Science & Medicine, Elsevier, vol. 75(8), pages 1351-1361.

    More about this item

    JEL classification:

    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:oxecpp:v:70:y:2018:i:2:p:353-374.. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press (email available below). General contact details of provider: https://academic.oup.com/oep .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.