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Incentivizing Demand for Supply-Constrained Care: Institutional Birth in India

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  • Alison Andrew

    (Department of Economics, University of Oxford, and Institute for Fiscal Studies)

  • Marcos Vera-Hernández

    (Department of Economics, University College London, and Institute for Fiscal Studies)

Abstract

If overcrowding harms health care quality, the impacts of encouraging more people to use services are not obvious. Impacts will depend on whether marginal entrants benefit and whether they benefit enough to offset the congestion externalities imposed on inframarginal users. We develop a general-equilibrium model that formalizes these ideas. We examine them empirically by studying JSY, a program in India that paid women to give birth in medical facilities. We find evidence that JSY increased perinatal mortality in areas with low health-system capacity, was particularly harmful in more-complex births, reduced the quality of facilities' postnatal care, and generated harmful spillovers onto other services.

Suggested Citation

  • Alison Andrew & Marcos Vera-Hernández, 2024. "Incentivizing Demand for Supply-Constrained Care: Institutional Birth in India," The Review of Economics and Statistics, MIT Press, vol. 106(1), pages 102-118, January.
    • Handle: RePEc:tpr:restat:v:106:y:2024:i:1:p:102-118
    DOI: 10.1162/rest_a_01206
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