Health policy in poor countries: weak links

Abstract There is broad consensus that a mix of public health, preventive and simple curative activities provided through low-level facilities is the right policy for public expenditures on health in developing countries. Yet this near unanimous consensus is in sharp contrast to a mixed record in practice and consistent disappointment in implementation. We show how the recent theoretical and empirical literature on the economics of health sheds light on both the disappointment and the consensus by emphasizing various links in the entire chain of events from public spending to health status. First, incorporating the analysis of the health seeking behavior of individuals can completely change conclusions about the appropriate role for, and the expected impact of, public sector interventions. Second, highlighting the key role of providers ’ incentives in determining the actual efficacy and quality with which the consensus around something like primary health care (PHC) is implemented also changes the expectation of effectiveness of public interventions. Both aspects emphasize the deep difficulties encountered with bringing incentives, whether for suppliers or for users, to bear on the delivery of PHC. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the World Bank, its Executive Directors, or the countries they represent. This paper grew out of an earlier collaboration between the authors and Maureen Lewis and Samuel Lieberman. We would like to thank Martin Ravaillon and Susan Stout for helpful discussions. Comments are welcome. “Avoidable ” deaths are defined as the excess of the average death rate for the 0-5 age1 group in the low- and middle-income countries of 88 per 1000 versus the level in the high-income countries, 9. Using a comparable approach Gwatkin (1980) calculated the total number of deaths of under fives to be about 15 million. Income is in 1995 international dollars which are adjusted for purchasing power2 differences