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Household Responses to Public Health Services: Cost and Quality Tradeoffs

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  • Alderman, Harold
  • Lavy, Victor

Abstract

The effectiveness of government investments in health care depends on the public's response to price and quality as well as on whether these expenditures actually improve health outcomes. Consumers, even those in low-income households, are willing to pay fees for better health care if the fees translate into improved access and reliability. But when prices rise without a concomitant improvement in services, malnutrition and child mortality rates increase. The availability of basic health care has a relatively greater impact on households with low incomes or low education, or both, than does the provision of more specialized services. This article describes the types of services for which households indicate they are willing to pay increased fees. It also indicates the potential gains from improving these services, as well as the consequences of moving faster on cost recovery than on providing improved or better-targeted services. Copyright 1996 by Oxford University Press.

Suggested Citation

  • Alderman, Harold & Lavy, Victor, 1996. "Household Responses to Public Health Services: Cost and Quality Tradeoffs," World Bank Research Observer, World Bank Group, vol. 11(1), pages 3-22, February.
  • Handle: RePEc:oup:wbrobs:v:11:y:1996:i:1:p:3-22
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    Cited by:

    1. Castro-Leal, Florencia & Dayton, Julia & Demery, Lionel & Mehra, Kalpana, 1999. "Public Social Spending in Africa: Do the Poor Benefit?," World Bank Research Observer, World Bank Group, vol. 14(1), pages 49-72, February.
    2. Lindelow, Magnus, 2002. "Health care demand in rural Mozambique," FCND discussion papers 126, International Food Policy Research Institute (IFPRI).
    3. Gertler, Paul J. & Hammer, Jeffrey S., 1997. "Strategies for pricing publicly provided health services," Policy Research Working Paper Series 1762, The World Bank.
    4. Magnus Lindelow, 2003. "Understanding spatial variation in the utilization of health services: does quality matter?," Economics Series Working Papers WPS/2004-12, University of Oxford, Department of Economics.
    5. Mataria, Awad & Donaldson, Cam & Luchini, Stephane & Moatti, Jean-Paul, 2004. "A stated preference approach to assessing health care-quality improvements in Palestine: from theoretical validity to policy implications," Journal of Health Economics, Elsevier, vol. 23(6), pages 1285-1311, November.
    6. Paul Collier & Stefan Dercon & John Mackinnon, 2002. "Density versus Quality in Health Care Provision: Using Household Data to Make Budgetary Choices in Ethiopia," World Bank Economic Review, World Bank Group, vol. 16(3), pages 425-448, December.
    7. Devarajan, Shantayanan & Hammer, Jeffrey S., 1998. "Risk reduction and public spending," Policy Research Working Paper Series 1869, The World Bank.
    8. Hentschel, Jesko, 1998. "Distinguishing between types of data and methods of collecting them," Policy Research Working Paper Series 1914, The World Bank.
    9. Orazem, Peter & Gunnarsson, Victoria, 2004. "Child Labour, School Attendance and Performance: A Review," Staff General Research Papers Archive 11177, Iowa State University, Department of Economics.
    10. Hammer, Jeffrey S, 1997. "Economic Analysis for Health Projects," World Bank Research Observer, World Bank Group, vol. 12(1), pages 47-71, February.
    11. Trani, Jean-Francois & Bakhshi, Parul & Noor, Ayan A. & Lopez, Dominique & Mashkoor, Ashraf, 2010. "Poverty, vulnerability, and provision of healthcare in Afghanistan," Social Science & Medicine, Elsevier, vol. 70(11), pages 1745-1755, June.
    12. Margaret E. Grosh & Paul Glewwe, 1998. "Data Watch: The World Bank's Living Standards Measurement Study Household Surveys," Journal of Economic Perspectives, American Economic Association, vol. 12(1), pages 187-196, Winter.
    13. Orazem, Peter F. & Gunnarsson, Victoria., 2003. "Child labour, school attendance and academic performance : a review," ILO Working Papers 993665413402676, International Labour Organization.
    14. Álvarez, Begoña & Vera-Hernández, Marcos, 2013. "Exploiting subjective information to understand impoverished children's use of health care," Journal of Health Economics, Elsevier, vol. 32(6), pages 1194-1204.
    15. Canaviri, Jose, 2007. "A Random Parameter Logit model for modeling Health Care Provider Choice in Bolivia," MPRA Paper 3263, University Library of Munich, Germany.
    16. Jehu-Appiah, Caroline & Aryeetey, Genevieve & Spaan, Ernst & de Hoop, Thomas & Agyepong, Irene & Baltussen, Rob, 2011. "Equity aspects of the National Health Insurance Scheme in Ghana: Who is enrolling, who is not and why?," Social Science & Medicine, Elsevier, vol. 72(2), pages 157-165, January.
    17. Mataria, Awad & Giacaman, Rita & Khatib, Rana & Moatti, Jean-Paul, 2006. "Impoverishment and patients' "willingness" and "ability" to pay for improving the quality of health care in Palestine: An assessment using the contingent valuation method," Health Policy, Elsevier, vol. 75(3), pages 312-328, February.
    18. Shantayanan Devarajan & F. Halsey Rogers, 2002. "World Bank Economists' Forum : Volume 2," World Bank Publications, The World Bank, number 15227, June.
    19. Magnus Lindelow, 2004. "Understanding spatial variation in the utilization of health," Development and Comp Systems 0409058, EconWPA.
    20. Gauri, Varun, 2001. "Are incentives everything? payment mechanisms for health care providers in developing countries," Policy Research Working Paper Series 2624, The World Bank.

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