Wealth and health in Africa Nicholas Li


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Wealth and health in Africa Nicholas Li

  1. 1. Health in the developing world Nicholas Li, University of Toronto February 20, 2013
  2. 2. Proven nutritional interventions Iron ($7): seven months of iron supplements in Indonesia increases self-employed earnings by 30% for anemic males Deworming ($0.25): children receiving 2-3 years of extra deworming in Kenya go to school 0.3 years longer, at ages 19-26 work 12% more hours and earn 20% more Iodine ($0.62): when given to pregnant women in Tanzania increased child schooling 0.3-0.5 years (vs. 4-5 average) Vitamin A to prevent night-blindness, breast-feeding until six monthsWhat doesn’t work: subsidized grains
  3. 3. Proven infectious illness interventions Insecticide-treated malaria bednets ($14, lasts 5 years ): child growing up malaria free earns up to 50% more over their lifetime Chlorin ($0.18/month): purify water Oral rehydration solution (almost free): can significantly reduce deaths from diarrhea/dehydration Vaccinations ($3.30): “basic package” of polio, diphtheria, tuberculosis, pertussis, measles, tetanus HIV/AIDs: condoms, anti-retrovirals (but not cheap)
  4. 4. Low-hanging fruit not being picked! Bednets: only 47% of children use them in Kenya ORS: only given to 1/3 of children in India with diarrhea Chlorin: only 10% of households in Zambia use it Vaccination: 2-3 million children die from preventable disease each year, vaccination rates low in some countries (only 80% coverage globally) Iron supplements, iodine, deworming not widely used in developing worldTake-up of these things is not very income-sensitive
  5. 5. Do the poor care? Non-trivial share of household budgets spent on health: 5%-8% Households sell valuable assets and incur substantial debt, at high interest rates, to seek treatment Although many public resources are free, they are underused Instead spend money on traditional medicine, private doctors who prescribe steroids, IV drips and antibiotics as “treatment”
  6. 6. Why low take-up? Low quality and utilization of public services: absenteeism (as high as 50% in some countries), private medicine unregulated Information: difficult to learn about what works in health Trust/belief: hence trust in authorities is key, but often low among poor Procrastination: current costs but future benefits Inequality within household: who makes decisions and who benefits?
  7. 7. The way forward: social engineering and “nudges” Subsidies: take-up price-sensitive, free vs. (low) cost Convenience: increase chlorin use in Kenya from 10% to 50% with free public chlorin dispenser at point-of-source and paid local promoter Bribery: achieved almost universal vaccination by offering free food, steel plates for completing vaccination course Incentive-compatible government intervention: mandating micronutrients added to desirable food productsInformation/awareness only goes so far...
  8. 8. WE are not so differentA little paternalism goes a long way How much do we really know about nutrition? And how much do we optimize for health? Information about cigarettes vs. taxes/smoking bans Vaccines and autism Chronic/hard to treat conditions: chiropracty/homeopathy Who decides? US abortion debateMany health decisions made for us: micronutrients added to food,chlorine and fluoride added to water, mandatory sanitation andvaccinations, regulation of doctors, etc.
  9. 9. HIV/AIDS Relevant information: in Kenya, telling girls that HIV rates are higher for older men is more effective at reducing teen pregnancy, dropouts than “ABC” (abstinence, be faithful and use condoms) Bribery: in Tanzania, conditional cash transfer of $20 subject to negative tests over 12 months substantially reduced prevalence 31% Behavioral response and moral hazard: ART availability increases risky behavior, but lowers transmission risk → latter effect dominates ARTs and development: increase subjective perception of life expectancy, improved mental health (including of HIV negative) and increase savings, education