Measurement and Explanation of Inequality in Health and Health Care in Low-Income Settings

This paper describes approaches to the measurement and explanation of income-related inequality and inequity in health care financing, health care utilization and health and considers the applicability and the feasibility of these methods in low-income countries. Results from a comparative study of 14 Asian countries are used to illustrate the main issues. The structure of health finance in low-income countries, in particular the heavy reliance on out-of-pocket payments, means that the equity issues in finance are quite different from those of concern in high-income countries. Primary concern is not with the distribution of contributions to pre-payment mechanisms but with the deterrent effect of payments on utilization and the distribution of uninsured payment risks. Measurement of inequity in utilization of health care in low-income countries is constrained by the lack of reliable measures of health that can be used to standardize for need. Nonetheless, sufficient is known of the distribution of need in many circumstances in order to make inferences about equity from inequality in health care use. The empirical analyses demonstrate that, in low-income countries, the better-off tend to pay more for health care, both absolutely and in relative terms. But they also consume more health care. Health care is financed is largely according to the benefit principle. Assessing the distributional performance of health systems in low-income settings therefore requires examination of finance and utilization simultaneously.health inequality, equity

The Effect of Disability on Employment Allowing for Work Incapacity

Previous modelling of the impact of disability on employment has failed to allow for a direct effect rendering some individuals capable of work. A model in which both a capacity and a desire for work are necessary conditions for employment is estimated from a sample of British disabled men. Recognition that individuals may be incapable of work helps identify work capacity and leads to a test for errors in reported capacity data. The capacity for work condition is found to be relevant and failure to allow for it results in overestimation of the wage elasticity of employment. The accuracy of self-reported capacity information is rejected

The Political Economy of a Publicly Provided Private Good with Adverse Selection

Given heterogeneity in incomes and health risks, with asymmetric information in the latter, preferences over the public-private mix in health insurance and care are derived. Results concerning crowding-out in the presence of adverse selection are established. For low-risk individuals, crowding-out depends on risk aversion. A set of such individuals prefers a mixed public-private health care system. A majority-voting equilibrium exists. Under weak assumptions about the income distribution and tax function, both public and private sectors exist in the equilibrium. Comparing information regimes, public provision is more likely to be positive, and will not be lower, under asymmetric information. In the presence of asymmetric information, the equilibrium is more complicated than the "ends-against-the-middle" variety derived elsewhere in the literature

Estimating Tax Incidence, Market Power and Market Conduct: The European Cigarette Industry

Recent theoretical work has shown that the incidence of ad valorem and specific taxes may differ and each may be over or under-shifted onto consumers in the presence of imperfect competition. These results are used to derive a method of estimating market power and conduct. An application is made to the European cigarette industry. Previous empirical comparison of the price effects of ad valorem and specific taxes is limited. For a group of countries with broadly similar cigarette industries, there is evidence of undershifting of both taxes, with the specific tax having a significantly greater impact on price. The extremes of both perfect competition and monopoly can be rejected. Behaviour is no less competitive than the equivalent of Cournot

The Comparison Between Ad Valorem and Specific Taxation under Imperfect Competition: Evidence from the European Cigarette Industry

Recent theoretical work has shown that the incidence of ad valorem and specific taxes may differ and each may be over or under-shifted onto consumers in the presence of imperfect competition. Empirical comparison of the price effects of the two taxes is limited. There are no previous estimates of these effects derived from data displaying reasonable variation in both types of taxes. We fill this gap by estimating the impact on prices of specific and ad valorem taxes levied on cigarettes in Europe. The results are consistent with the theory. There is evidence of under and over-shifting and the specific tax has a significantly greater effect on price than the ad valorem

Measurement and explanation of inequality in health and health care in low-income settings

This paper describes approaches to the measurement and explanation of income-related inequality and inequity in health care financing, health care utilization and health and considers the applicability and the feasibility of these methods in low-income countries. Results from a comparative study of 14 Asian countries are used to illustrate the main issues. The structure of health finance in low-income countries, in particular the heavy reliance on out-of-pocket payments, means that the equity issues in finance are quite different from those of concern in high-income countries. Primary concern is not with the distribution of contributions to pre-payment mechanisms but with the deterrent effect of payments on utilization and the distribution of uninsured payment risks. Measurement of inequity in utilization of health care in low-income countries is constrained by the lack of reliable measures of health that can be used to standardize for need. Nonetheless, sufficient is known of the distribution of need in many circumstances in order to make inferences about equity from inequality in health care use. The empirical analyses demonstrate that, in low-income countries, the better-off tend to pay more for health care, both absolutely and in relative terms. But they also consume more health care. Health care is financed is largely according to the benefit principle. Assessing the distributional performance of health systems in low-income settings therefore requires examination of finance and utilization simultaneously