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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).

Suggested Citation

  • Sonia Bhalotra, 2007. "Spending to Save? State Health Expenditure and Infant Mortality in India," The Centre for Market and Public Organisation 07/169, Department of Economics, University of Bristol, UK.
  • Handle: RePEc:bri:cmpowp:07/169
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    Cited by:

    1. Kruse, Ioana & Pradhan, Menno & Sparrow, Robert, 2012. "Marginal benefit incidence of public health spending: Evidence from Indonesian sub-national data," Journal of Health Economics, Elsevier, vol. 31(1), pages 147-157.
    2. Sonia Bhalotra & Irma Clots-Figueras, 2014. "Health and the Political Agency of Women," American Economic Journal: Economic Policy, American Economic Association, vol. 6(2), pages 164-197, May.
    3. Olena Y. Nizalova & Maria Vyshnya, 2010. "Evaluation of the impact of the Mother and Infant Health Project in Ukraine," Health Economics, John Wiley & Sons, Ltd., vol. 19(S1), pages 107-125, September.
    4. Kasper Brandt & Longinus Rutasitara & Onesmo Selejio & Neda Trifkovic, 2017. "Entrepreneurship and human capital development in children," WIDER Working Paper Series 198, World Institute for Development Economic Research (UNU-WIDER).
    5. Mansour Farahani & S. V. Subramanian & David Canning, 2010. "Effects of state-level public spending on health on the mortality probability in India," Health Economics, John Wiley & Sons, Ltd., vol. 19(11), pages 1361-1376.
    6. Kaushal, Kaushalendra Kumar & F Ram, Faujdar Ram & Abhishek, Abhishek Singh, 2013. "Public Spending on Health and Childhood Mortality in India," MPRA Paper 48680, University Library of Munich, Germany.
    7. Bhalotra, Sonia, 2010. "Fatal fluctuations? Cyclicality in infant mortality in India," Journal of Development Economics, Elsevier, vol. 93(1), pages 7-19, September.
    8. repec:kap:hcarem:v:20:y:2017:i:4:d:10.1007_s10729-016-9367-1 is not listed on IDEAS
    9. repec:esx:essedp:739 is not listed on IDEAS
    10. Kundu, Nobinkhor, 2014. "Millennium development goals and structural stability of child mortality in Bangladesh," MPRA Paper 65241, University Library of Munich, Germany, revised 11 Dec 2014.
    11. Casabonne, Ursula & Kenny, Charles, 2012. "The Best Things in Life are (Nearly) Free: Technology, Knowledge, and Global Health," World Development, Elsevier, vol. 40(1), pages 21-35.
    12. repec:spr:qualqt:v:51:y:2017:i:6:d:10.1007_s11135-016-0404-4 is not listed on IDEAS
    13. Prachitha J. & K.R. Shanmugam, 2012. "Efficiency of Raising Health Outcomes in the Indian States," Working Papers 2012-070, Madras School of Economics,Chennai,India.
    14. Barenberg, Andrew J. & Basu, Deepankar & Soylu, Ceren, 2015. "The Effect of Public Health Expenditure on Infant Mortality: Evidence from a Panel of Indian States, 1983-84 to 2011-12," UMASS Amherst Economics Working Papers 2015-19, University of Massachusetts Amherst, Department of Economics.
    15. repec:kap:ijhcfe:v:17:y:2017:i:4:d:10.1007_s10754-017-9219-7 is not listed on IDEAS
    16. Nilgun Yavuz & Veli Yilanci & Zehra Ozturk, 2013. "Is health care a luxury or a necessity or both? Evidence from Turkey," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 14(1), pages 5-10, February.

    More about this item

    Keywords

    public spending; health; poverty; infant mortality; India;

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • 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; Spatio-temporal Models

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