The Distributional Impact of Healthcare Financing in Nigeria: A Case Study of Enugu State

The deregulation of healthcare financing and supply in Nigeria has shifted the healthcare system towards competitive market ideals. Households' decision to utilize healthcare is identical with healthcare financing. This financing arrangement has potentials for income redistribution in a society with already high levels of inequality in resource redistribution. This study attempts to examine the extent to which this system of healthcare financing leads to catastrophic expenditures, defined as a threshold percentage of a household's income, and the extend of impoverishment arising from healthcare spending. It also uses the Aronson, Johnson, and Lambert (1994) decomposition framework to analyze redistributive effects in terms of vertical and horizontal inequities, as well as re-ranking effect. The study finds that healthcare spending engenders high incidence of catastrophic spending and impoverishment in the population. It also finds that healthcare spending is pro-rich in its redistributive effect, with significant vertical and horizontal inequities as well as reranking inherent in the system. The paper suggests policy reforms that separate healthcare utilization from healthcare financing if the poor are to have access to healthcare services.Redistributive effects, Healthcare financing, Catastrophic financing, Impoverishing effects, Equity, Nigeria

Contingent Valuation in Community-Based Project Planning: The Case of Lake Bamendjim Fishery Restocking in Cameroon

The study examined the usefulness and relevance of the contingent valuation method (CVM) in community-based (CB) project planning and implementation. To elicit willingness to pay (WTP) values for the restocking of Lake Bamendjim with Tilapia nilotica and Heterotis niloticus fish species, the study used pre-tested questionnaires interviewer-administered to 1,000 randomly selected households in the Bambalang Region of Cameroon.The datawere elicitedwith the conventional referendumdesign and analysed using a referendum model. Empirical findings indicated that about 85% of the sampled households were willing to pay about CFAF1,054 (US$2.1) for the restocking project. This amount was found to be significantly related to the starting price used in the referendum design, household income, the gender of the respondent, the age of the respondent, household poverty status, and previous participation of a household in a community development project.The findings prompted the following recommendations. Firstly, in order to reduce community burden due to cash constraints, it is advisable for the mean estimate obtained for the scheme to be split into four instalments over a year. Secondly, since the success of the scheme largely depends on the governing roles of the scheme, it is further advisable for the community to allowthemanagement of the scheme to be handled by the elderly community members. Finally, it will be important during the financing of the scheme, to levy wealthier household heads an amount sufficient to subsidize poorer household heads who cannot afford to pay the threshold price.

Estimating the willingness to pay for community healthcare insurance in rural Nigeria

Health care financing in Nigeria is dominated by private out-of-pocket payment that is not affordable to the poor. This has greatly reduced access to quality health care for the predominantly rural poor. Insurance schemes as options for increasing access to health care services have not received considerable attention in Nigeria. In this regard, a community health prepayment scheme is proposed, and the Contingent Valuation Method is used to investigate the willingness of rural households to pay for this scheme. Contributing through agricultural commodities produced statistically higher estimates than through direct cash. Also, by incorporating uncertainty in responses using the Random Valuation Model, higher contribution amounts were obtained. This provides an option for its use in healthcare contingent valuation studies where respondents are uncertain about their true responses. The groups that are willing to pay lesser amounts into the scheme as compared with their counterparts are women, the less educated, and the less wealthy households.Health care financing, Prepayment scheme, contingent valuation, willingness to pay, dichotomous choice, uncertainy, random valuation, stochastic payment card

A distributional analysis of out-of-pocket healthcare financing in Nigeria using a new decomposable Gini index

This study applies a new method of decomposing total redistributive effect of taxation proposed by Duclos et al. (2003) to assess the redistributive effects of direct healthcare financing in Nigeria. This new framework makes it possible not only to introduce into the conventional Gini Index estimation framework a flexible ethical measure of aversion to inequality but also a novel concepts of horizontal inequity and re-ranking. The empirical results indicate that when the decision to utilize healthcare is always linked to the decision to pay for healthcare, as is the case in Nigeria, out-of-pocket payment, contrary to existing literature, may indeed be progressive with high levels of horizontal inequity and re-ranking effect. But the progressivity may underlie the lack of ability to pay by poorer households. All the components of the redistributive effect are also likely to vary with the level of the social aversion to inequit

The Distributional Impacts of Forest Income on Household Welfare in Rural Nigeria

The study examines the distributional implications of forest income on poverty and income inequality in rural Nigeria using Gini and poverty decomposable techniques. The study finds that forest income reduces both income inequality and poverty in rural Nigeria. Analysis of the determinants of forest income using Heckman's 2-step sample selection model indicates that the decision to participate in forest extraction increases with more access to community forest areas, larger and poorer households, membership in forest management committees; and decreases with higher educational attainment and higher transfer income earnings. Likewise, forest income was found to be positively and significantly related to male-headed households, poorer heads of household and households that have more access to forest resources outside the community forestry areas. Furthermore, poverty and inequality simulations revealed that household welfare in rural Nigeria could be improved through policies and programs that; can stimulate increase earnings from minor forest resources, assist households to earn income from alternative sources such as agriculture and commerce

Simple sequential procedure for modeling of item non-response in econometric analysis: Application to CV survey data

Item non-response occurs when respondents fail to provide answers to some or all of the questions posed during survey interviews. The standard procedure is to exclude such responses from the econometric analysis. This may be appropriate if the sample included does not differ significantly from those excluded in the analysis. If this is not the case, the econometric analyst faces a sample selection bias problem. The aim of this paper is to provide further evidence using a simple sequential procedure to deal with the problem when using non-randomly selected samples in social science research. The procedure entails different levels of estimation and diagnostic with the Ordinary Least Squares (OLS), Heckman's 2-step and Full Information Maximum Likelihood (FIML) estimators. In the application context, we found the FIML estimator to be more efficient in dealing with sample selection bias than the Heckman's 2-step approach

Climate Change and Plantation Agriculture: A Ricardian Analysis of Farmlands in Nigeria

This study used the Ricardian approach that captures farmer adaptations to varying environmental factors to analyze the impact of climate change (CC) on plantation agriculture in Nigeria. By collecting data from 280 farm households in seven different agro-ecological zones of Nigeria (Cross River, Abia, Edo, Ondo, Ekiti, Oyo and Ogun States), the quantity of crops produced over time and land value proxied by net revenue per hectares (NR), were regressed on climate, household and soil variables. The results suggest that these variables have a significant impact on the net crop revenue per hectare of farmlands under Nigerian conditions. Specifically, seasonal marginal impact analysis indicates that increasing temperature during summer and winter would significantly reduce crop net revenue per hectare whereas marginally increasing precipitation during spring would significantly increase net crop revenue per hectare. Furthermore, the net crop revenue impact of predicted climate scenarios from three models (CGM2, HaDCM3 and PCM) for the years 2020, 2060 and 2100 suggest drastic decline in future net revenue per hectare for plantation crops in Nigeria. However, these marginal impacts are not uniformly distributed across the different agro-ecological zones in Nigeria

International Remittance Inflows and Household Welfare: Empirical Evidence from Nigeria

The contribution of remittances income in mitigating poverty and income inequality in Nigeria has attracted very little attention in general. Very few studies have looked at the quantitative relationship between remittance inflows, poverty and income inequality in Nigeria even though it is now believed that total remittance inflows into Nigeria; exceed Foreign Direct Investments (FDI) and Overseas Development Assistant (ODA). Using poverty and Gini decomposable techniques, the study finds that household poverty declines across all the geopolitical zones, by sex and locality as a result of remittance inflows. For example, with remittances, household poverty falls from 0.35 to 0.30 in the South-South region, 0.27 to 0.22 in the South-East region and 0.43 to 0.36 in the South-West region. Poverty also declines from 0.67 to 0.60 in the North-Central region, 0.72 to 0.66 in the North-East and from 0.71 to 0.66 in the North-West regions. Similarly, in the Gini decomposition; the study finds that increase in remittances reduce income inequality more in urban areas (0.1) than in rural areas (0.02). For example, a 10% increase in remittances other things being equal, is associated with declines in the Gini coefficients of total income inequality of 0.02% in rural area and 0.1% in the urban area

Farmers Awareness, Perception of Climate Hazards and their Willingness to Participate in Crop Insurance Schemes in Southwestern Burkina Faso

AbstractInnovative financing arrangements such as index-base crop insurance (IBCI) schemes are increasingly becoming popular in West Africa for managing catastrophic agricultural risks. Recently, an IBCI pilot project was launched in Burkina Faso by PlaNet Guarantee11A member of the Planet Finance Group and the Global Index Insurance Facility program (GIIF).. However, similar to many existing IBCI schemes in the region, the enrolment rate is still very low. One possible explanation for this is based on the fact that remote sensing data is used as the basis for the design. Although the use of remote sensing data is appealing in many respect, it has several limitations. One major limitation is that it fails to take into account sensitive phases of the crops cycle, which may be more prone to climate and other environmental stresses (Muller, 2014).In this paper, we highlights the importance of using field facts in the design of innovative IBCI schemes in rural Burkina Faso. Farmers’ awareness and perception of climate hazards in relation to crop productivity and their willingness to participate (WTP) in IBCI in South-western Burkina were captured through household surveys and focus group discussions. Empirical findings indicate that farmers are aware of the effects of climate hazard on farm productivity and consider mid-season dry spells, during sowing, flowering and ripening depending on the crop type, as the most significant climate risk affecting local crop productivity. Specifically, 98% of the sampled farmers are willing to insure maize, cotton and sorghum, but only if the most sensitive periods of these crops to dry spell are taken into account in designing the crop insurance contracts. Furthermore, Probit regression analysis indicates that the probability to participate increases with years of farming experience, past experience of climate hazards, educational attainment of household head and insecurity to climate hazard, and decreases with farmer's age and household size