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Provision of Primary Health Care in Bangladesh: An Institutional Analysis


  • Ahmad, Alia

    (Department of Economics, Lund University)


New institutional economics and organizational theories suggest that the choice of institutional arrangements in service provision should be based on the goods characteristics of the services to be provided. The success of any system whether decentralized public sector or private and community-based organizations, depends on the regulatory and coordinator role of the government. Taking the example of Bangladesh the paper argues that the financier role of the government is justified because of the consumption characteristics of the primary health care services and market failures. But the provider role of the government has to be considered carefully keeping in mind the goods characteristics on the production side. The public health facilities in Bangladesh function poorly due to lack of proper decentralization with the result that a majority of the clients seek medical services in the private sector - both for-profit and not-for-profit. The quality and access to these services are far from satisfactory because the government has failed to perform its regulator and coordinator role. The paper points toward the need for research on institutional issues like principal-agent problems, contract formulation and enforcement procedures.

Suggested Citation

  • Ahmad, Alia, 2003. "Provision of Primary Health Care in Bangladesh: An Institutional Analysis," Working Papers 2003:18, Lund University, Department of Economics.
  • Handle: RePEc:hhs:lunewp:2003_018

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    References listed on IDEAS

    1. Mehra, Rajnish & Prescott, Edward C., 1985. "The equity premium: A puzzle," Journal of Monetary Economics, Elsevier, vol. 15(2), pages 145-161, March.
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    5. Best, Michael J & Grauer, Robert R, 1991. "On the Sensitivity of Mean-Variance-Efficient Portfolios to Changes in Asset Means: Some Analytical and Computational Results," Review of Financial Studies, Society for Financial Studies, vol. 4(2), pages 315-342.
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    More about this item


    decentralization; primary healhcare; NGO's;

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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