nep-hea New Economics Papers
on Health Economics
Issue of 2019‒06‒24
24 papers chosen by
Nicolas R. Ziebarth
Cornell University

  1. A Local Community Course that Raises Mental Wellbeing and Pro-Sociality By Jan-Emmanuel De Neve; Daisy Fancourt; Christian Krekel; Richard Layard
  2. The Perry Preschoolers at Late Midlife: A Study in Design-Specific Inference By Heckman, James J.; Karapakula, Ganesh
  3. When Dad Can Stay Home: Fathers' Workplace Flexibility and Maternal Health By Petra Persson; Maya Rossin-Slater
  4. Child Socio-Emotional Skills: The Role of Parental Inputs By Gloria Moroni; Cheti Nicoletti; Emma Tominey
  5. Socioeconomic Gaps in Child Development: Evidence from a National Health and Nutrition Survey in Bolivia By Celhay, Pablo; Martinez, Sebastian; Vidal, Cecilia
  6. Valuing Children’s Fatality Risk Reductions By Robinson, Lisa A.; Raich, William; Hammitt, James K.
  7. Sons or Daughters? The Impact of Children's Migration on the Health and Well-Being of Parents Left Behind By Wahba, Jackline; Wang, Chuhong
  8. The Effect of Medicare Part D on Evergreening, Generic Entry, and Drug Prices By Geoffrey T. Sanzenbacher; Gal Wettstein
  9. Do States Adjust Medicaid Enrollment in Response to Capitation Rates? Evidence from the Medicare Part D Clawback By Laura D. Quinby; Gal Wettstein
  10. Questioning the Stereotype of the "Malingering Bureaucrat": Absence from Work in the Public and Private Sector in Germany By Prümer, Stephanie; Schnabel, Claus
  11. Household Consumption Responses to SNAP Participation By Burney, Shaheer
  12. Eat at Home or Away from Home? The Role of Grocery and Restaurant Food Sales Taxes By Zheng, Yuqing; Dong, Diansheng; Burney, Shaheer; Kaiser, Harry M.
  13. An Analysis of Beverage Size Restrictions By Bourquard, Brian A.; Wu, Steven Y.
  14. The effect of unemployment on the smoking behavior of couples By Everding, Jakob; Marcus, Jan
  15. The health effects of smoking bans: Evidence from German hospitalization data By Kvasnicka, Michael; Siedler, Thomas; Ziebarth, Nicolas
  16. Distributional Effects of Education on Health By Silvia H. Barcellos; Leandro S. Carvalho; Patrick Turley
  17. Battling antibiotic resistance: can machine learning improve prescribing? By Michael Allan Ribers; Hannes Ullrich
  18. Impact of Increased Long-Term Care Insurance Payments on Employment and Wages in Formal Long-Term Care By Kondo, Ayako
  19. Redistributive Effects of Different Pension Systems When Longevity Varies by Socioeconomic Status By Miguel Sánchez-Romero; Ronald D. Lee; Alexia Prskawetz
  20. The Measurement of Health Inequalities: Does Status Matter? By Costa-Font, Joan; Cowell, Frank A.
  21. Love the Job... or the Patient?: Task vs. Mission-Based Motivations in Health Care By Banuri, Sheheryar; Keefer, Philip; Walque, Damien de
  22. Dynamic hospital competition under rationing by waiting times By Luís Sá; Luigi Siciliani; Odd Rune Straume
  23. Globalization and Obesity: Asian Experiences of ‘Globesity’ By Ghosh, sudeshna
  24. In-Kind Incentives and Health Worker Performance: Experimental Evidence from El Salvador By Martinez, Sebastian; Bernal, Pedro

  1. By: Jan-Emmanuel De Neve; Daisy Fancourt; Christian Krekel; Richard Layard
    Abstract: Although correlates of mental wellbeing have been extensively studied, little is known about how to effectively raise mental wellbeing in local communities. We conduct a randomised controlled trial of the "Exploring What Matters" course, a scalable social-psychological intervention aimed at raising general adult population mental wellbeing and pro-sociality. The course is run by volunteers in their local communities, and is currently conducted in more than nineteen countries around the world. We find that it has strong positive causal effects on participants' self-reported subjective wellbeing and pro-social behaviour while reducing measures of mental ill health. Impacts seem to be sustained two months post-treatment. Biomarkers are noisy and mostly insignificant. However, there is some evidence that, for certain individuals, effects on self-reported outcomes may be accompanied by positive changes in biomarker outcomes, in particular reduced levels of pro-inflammatory cytokine IL-6.
    Keywords: wellbeing, pro-social behaviour, communities, intervention, RCT
    JEL: C93 I12 I31
    Date: 2019–06
  2. By: Heckman, James J. (University of Chicago); Karapakula, Ganesh (University of Chicago)
    Abstract: This paper presents the first analysis of the life course outcomes through late midlife (around age 55) for the participants of the iconic Perry Preschool Project, an experimental high-quality preschool program for disadvantaged African-American children in the 1960s. We discuss the design of the experiment, compromises in and adjustments to the randomization protocol, and the extent of knowledge about departures from the initial random assignment. We account for these factors in developing conservative small-sample hypothesis tests that use approximate worst-case (least favorable) randomization null distributions. We examine how our new methods compare with standard inferential methods, which ignore essential features of the experimental setup. Widely used procedures produce misleading inferences about treatment effects. Our design-specific inferential approach can be applied to analyze a variety of compromised social and economic experiments, including those using re-randomization designs. Despite the conservative nature of our statistical tests, we find long-term treatment effects on crime, employment, health, cognitive and non-cognitive skills, and other outcomes of the Perry participants. Treatment effects are especially strong for males. Improvements in childhood home environments and parental attachment appear to be an important source of the long-term benefits of the program.
    Keywords: randomized controlled trial, early childhood interventions, life cycle treatment effects, randomization tests, re-randomization, worst-case inference, least favorable null distributions, partial identification, small-sample hypothesis testing
    JEL: C1 C4 I21
    Date: 2019–05
  3. By: Petra Persson; Maya Rossin-Slater
    Abstract: While workplace flexibility is perceived to be a key determinant of maternal labor supply, less is known about fathers' demand for flexibility or about intra-household spillover effects of flexibility initiatives. This paper examines these issues in the context of a critical period in family life–the months immediately following childbirth–and identifies the impacts of paternal access to workplace flexibility on maternal postpartum health. We model household demand for paternal presence at home as a function of domestic stochastic shocks, and use variation from a Swedish reform that granted new fathers more flexibility to take intermittent parental leave during the postpartum period in a regression discontinuity difference-in-differences (RD-DD) design. We find that increasing the father's temporal flexibility reduces the risk of the mother experiencing physical postpartum health complications and improves her mental health. Our results suggest that mothers bear the burden from a lack of workplace flexibility–not only directly through greater career costs of family formation, as previously documented–but also indirectly, as fathers' inability to respond to domestic shocks exacerbates the maternal health costs of childbearing.
    JEL: I12 I18 I31 J12 J13 J38
    Date: 2019–05
  4. By: Gloria Moroni; Cheti Nicoletti; Emma Tominey
    Abstract: Informed by the psychological literature and our empirical evidence we provide new insights into the technology of socio-emotional skill formation in middle childhood. In line with economic evidence, increasing parental inputs that enrich the child home environment and reduce stress has larger returns for children with higher socio-emotional skills in early childhood (complementarity), but only for levels of inputs that are high. For low levels of inputs, i.e. levels implying a stressful home environment, an increase has a higher return for children with lower socio-emotional skills in early childhood (substitutability). Consequently, well targeted policies can reduce middle childhood socio-emotional gaps.
    Keywords: Socio-emotional skills, Complementarities, Substitutabilities, Parenting styles, Mother's mental health, Time investment, Child behavioural disorders, Diathesis-stress hypothesis.
    JEL: J13 D10 I10 I31
    Date: 2019–06
  5. By: Celhay, Pablo; Martinez, Sebastian; Vidal, Cecilia
    Abstract: This paper examines gaps in child development by socioeconomic status (SES) using a large nationally representative sample of children 0–59 months old in Bolivia and a rich set of child health and development outcomes including measures from dried blood samples. Child development is assessed with nutritional status, gross motor, and communicative development. Household SES is measured using direct and proxy indicators. We find an average difference of 0.80 and 0.60 standard deviations (SD) in height for age and weight for age z-scores respectively, between children in the top and bottom quintile of the expenditure distribution. Children in the top quintile are less likely to have iron deficiency (11 pp) and anemia (17 pp), whereas the gap in gross motor and communicative skills reach 0.28 and 0.20 SD respectively. By the age of three, these gaps have increased substantially to 0.92 SD (height for age), 0.24 pp (anemia), and 0.45 SD (gross motor). Our findings are robust to the choice of SES measurement and highlight the need to target social policies that can reduce these development gaps for children in low-income households.
    JEL: J13 I14
    Date: 2019–06
  6. By: Robinson, Lisa A.; Raich, William; Hammitt, James K.
    Abstract: The estimates used by U.S. Federal agencies and others to value reductions in fatality risks generally reflect adults’ willingness to trade income for changes in their own risks. Several studies have now been completed that address the value of risk reductions to children. We review these studies for quality and applicability based on selection and evaluation criteria derived from recent discussions of best practices. To limit the effects of between-study variability, we searched for studies that estimate values for both adults and children using a consistent approach. We find seven studies that meet our selection criteria. The studies suggest that the value for children exceeds the value for adults by a factor of 1.2 to 3.0, with a midpoint of 2.1. Studies that estimate the value of reductions in nonfatal risks lead to similar results. Although some studies suggest that the divergence between child and adult values may decrease as the child ages, more work is needed to determine the extent to which these multipliers vary across age groups.
    Keywords: benefit-cost analysis; value per statistical life; willingness to pay; health risk valuation; regulation
    Date: 2019–06
  7. By: Wahba, Jackline (University of Southampton); Wang, Chuhong (University of Southampton)
    Abstract: We study the impact of adult children's internal migration on the health and subjective well-being of elderly parents left behind, distinguishing between the gender of the migrant children. To overcome migration endogeneity, we exploit novel and exogenous variation in children's astrological characteristics and apply instrumental variables methods. We find a positive effect of the migration of daughters on parents' health and life satisfaction, but no such beneficial effects when sons migrate. We further explore the mechanism through which this gender-biased migration effect may arise. Our findings have important implications for regions and countries that have high rates of female emigration.
    Keywords: migration, health, subjective well-being, gender, Chinese zodiac signs
    JEL: O15 I12 J14 J16 R23
    Date: 2019–05
  8. By: Geoffrey T. Sanzenbacher; Gal Wettstein
    Abstract: Medicare Part D was established to expand outpatient prescription drug coverage to all seniors. An obvious effect of Part D was to improve the well-being of those who gained coverage by reducing their exposure to drug costs. But, the law also boosted demand for drugs used by those ages 65 and over, and extended the bargaining power enjoyed by commercial plans vis a vis drug manufacturers to the Part D market. Both these changes could give branded drug manufacturers extra incentive to protect their products’ monopoly status through so-called “evergreening,” with unforeseen impacts on the generic drug market and ultimately on prices. While work to date has generally found that Part D decreased prices through increased insurer bargaining power, that literature focused on the few years after Part D launched, a time before the effect of increased evergreening or decreased generic entry could be felt. This paper takes a longer view of how Part D has affected evergreening, generic entry, and ultimately drug prices in a difference-in differences design that compares these outcomes for drugs used frequently by those ages 65 and over to those used infrequently by this population. The results show that Part D increased evergreening and reduced generic entry, and suggest that these effects are associated with higher prices. However, Part D’s overall effect on drug prices is still negative, as the impact of insurer bargaining power apparently more than offsets the effect of more limited supply-side competition.
    Date: 2019–05
  9. By: Laura D. Quinby; Gal Wettstein
    Abstract: To curb rising Medicaid costs at the federal level, a number of recent policy proposals suggest capitation financing, under which program costs are fixed per beneficiary. This study examines to what extent more generous capitated federal subsidies would likely cause states to increase Medicaid enrollment. To answer this question, the analysis identifies a component of Medicaid that currently relies on capitation financing – the clawback provision in Medicare Part D – and uses that provision to estimate state responses to capitation rates. Specifically, the clawback requires states to pay the federal government a lump sum for each Medicaid enrollee who is also eligible for Medicare (dual-eligible). The size of the lump sum varies across states, based on a historical artifact: state-level prescription drug spending for dual-eligibles in 2003. Thus, the price of enrollment in any year after 2006, when Part D went into effect, is exogenous conditional on the 2003 price. The analysis shows that this within-state rigidity in the clawback formula creates substantial transfers between the federal government and the states, as well as among the states. It further finds that increasing clawback payments per dual-eligible by $100 would lead to a 2-percentage-point decrease in the share of dual-eligibles enrolled in Medicaid.
    Date: 2019–06
  10. By: Prümer, Stephanie (University of Erlangen-Nuremberg); Schnabel, Claus (University of Erlangen-Nuremberg)
    Abstract: Public sector employees are often said to have excessive rates of absence from work. Using representative survey data for Germany, we indeed find absenteeism of employees to be higher in the public than the private sector. The differences in the incidence and days of absence showing up in descriptive statistics are substantially reduced and partly disappear in our estimates of hurdle regression models controlling for individuals' socio-demographic characteristics, health status, professional activities, and for many workplace-related factors. Nevertheless, the probability of staying home sick at least once a year is still 5.6 percentage points higher in the public sector, ceteris paribus. This finding refutes popular assertions that differences in absence rates between the sectors are mainly due to structural factors like different compositions of the workforce. We show that the same observable factors play a role for absenteeism in the public and private sector, but we cannot rule out that shirking may play a more important role in the public sector. Nevertheless, we conclude that the stereotype of the "malingering bureaucrat" seems to be an exaggeration, at least for Germany.
    Keywords: absenteeism, public sector, sick leave, Germany
    JEL: I19 J22 H8
    Date: 2019–05
  11. By: Burney, Shaheer
    Abstract: Obesity is inordinately prevalent among food insecure households in the US. Some researchers have identified the consumption of unhealthy food a major source of this seemingly paradoxical relationship. One of the goals of the Supplemental Nutrition Assistance Program (SNAP), formerly known as the Food Stamp Program, is to encourage healthy eating behavior among low-income households. However, literature lacks conclusive evidence for the success of the program in achieving that goal. This paper exploits an underutilized source of variation, the early-2000s recession in the US, to determine the impact of SNAP participation on household Food Away From Home (FAFH) expenditures. A Difference in Difference model is constructed using high post-recession growth in SNAP caseloads as treatment. The results show that households in the treatment cohort significantly decrease consumption of FAFH relative to households in the control group. This provides evidence that SNAP participation leads households to make healthier eating choices.
    Keywords: Consumer/Household Economics, Food Consumption/Nutrition/Food Safety, Food Security and Poverty
    Date: 2017–09
  12. By: Zheng, Yuqing; Dong, Diansheng; Burney, Shaheer; Kaiser, Harry M.
    Abstract: Sales taxes on both grocery food and restaurant food exist in almost every county in the United States. By combining county level sales tax data with USDA’s recent national household food acquisition and purchase survey, we examine how a food sales tax affects consumers’ expenditures on grocery and restaurant food. We find that a grocery tax reduces consumers’ grocery food expenditures and increases restaurant food expenditure, which has further public health implication because the latter is generally considered to be less healthy. A restaurant food sales tax increases consumers’ grocery food expenditures. Such result provide insight into the potential impact of “fat” taxes on fast food restaurants. In addition, we find no differential impacts from food sales taxes based on consumers’ income, participation status in Supplemental Nutrition Assistance Program, or sharing borders with lower taxed counties. Finally, our results provide evidence that many consumers are attentive to food sales taxes even though the taxes are added at the register and are not salient.
    Keywords: Financial Economics, Food Consumption/Nutrition/Food Safety
    Date: 2017–09
  13. By: Bourquard, Brian A. (Ernst & Young); Wu, Steven Y. (Purdue University)
    Abstract: Due to high levels of obesity, various government interventions have been proposed to curb the consumption of sugar-sweetened beverages (SSBs). The New York City "soda-ban," which proposed to limit the size of SSBs is among the most well-known and controversial. While public debates about beverage-size-restrictions tend to focus on how consumers are impacted, we use a nonlinear pricing model to show that, for all but extremely tight restrictions, consumer welfare would be unaffected by an enforceable restriction. However, sellers' profit would decline. While consumption is predicted to decline overall, the magnitude of the decline will vary by consumer segment.
    Keywords: beverage size restrictions, health economics, nonlinear pricing, obesity, soda bans, sugar consumption
    JEL: D82 I18 I31
    Date: 2019–05
  14. By: Everding, Jakob; Marcus, Jan
    Abstract: Although unemployment likely entails various externalities, research examining its spillover effects on spouses is scarce. This is the first paper to estimate effects of unemployment on the smoking behavior of both spouses. Using German Socio-Economic Panel data, we combine matching and difference-indifferences estimation, employing the post-double-selection method for control-variable selection via Lasso regressions. One spouse's unemployment increases both spouses' smoking probability and intensity. Smoking relapses and decreased smoking cessation drive the effects. Effects are stronger if the partner already smokes and if the male partner becomes unemployed. Of several mechanisms discussed, we identify smoking to cope with stress as relevant.
    Keywords: smoking,risky health behaviors,unemployment,job loss,spillover effects,post-doubleselection method
    JEL: I12 J63 J65 C23
    Date: 2019
  15. By: Kvasnicka, Michael; Siedler, Thomas; Ziebarth, Nicolas
    Abstract: This paper studies the short-term impact of public smoking bans on hospitalizations in Germany. It exploits the staggered implementation of smoking bans over time and across the 16 federal states along with the universe of hospitalizations from 2000-2008 and daily county-level weather and pollution data. Smoking bans in bars and restaurants have been effective in preventing 1.9 hospital admissions (-2.1%) due to cardiovascular diseases per day, per 1 million population. We also find a decrease by 0.5 admissions (-6.5%) due to asthma per day, per 1 million population. The health prevention effects are more pronounced on sunny days and days with higher ambient pollution levels.
    Keywords: smoking bans,health effects,hospital admissions,second-hand smoke
    JEL: D12 H19 I12 I18
    Date: 2018
  16. By: Silvia H. Barcellos; Leandro S. Carvalho; Patrick Turley
    Abstract: This paper studies distributional effects of education on health. In 1972, England, Scotland, and Wales raised their minimum school-leaving age from 15 to 16 for students born after 9/1/1957. Using a regression discontinuity design and objective health measures for 0.27 million individuals, we find that education reduced body size and increased blood pressure in middle age. The reduction in body size was concentrated at the upper tail of the distribution with a 7.5 percentage point reduction in obesity. The increase in blood pressure was concentrated at the lower tail of the distribution with no effect on stage 2 hypertension.
    JEL: I10 I20
    Date: 2019–05
  17. By: Michael Allan Ribers; Hannes Ullrich
    Abstract: Antibiotic resistance constitutes a major health threat. Predicting bacterial causes of infections is key to reducing antibiotic misuse, a leading driver of antibiotic resistance. We train a machine learning algorithm on administrative and microbiological laboratory data from Denmark to predict diagnostic test outcomes for urinary tract infections. Based on predictions, we develop policies to improve prescribing in primary care, highlighting the relevance of physician expertise and policy implementation when patient distributions vary over time. The proposed policies delay antibiotic prescriptions for some patients until test results are known and give them instantly to others. We find that machine learning can reduce antibiotic use by 7.42 percent without reducing the number of treated bacterial infections. As Denmark is one of the most conservative countries in terms of antibiotic use, this result is likely to be a lower bound of what can be achieved elsewhere.
    Keywords: antibiotic prescribing, prediction policy, machine learning, expert decision-making
    JEL: C10 I11 I18 L38 O38 Q28
    Date: 2019
  18. By: Kondo, Ayako (University of Tokyo)
    Abstract: This paper examines the effect of raising Long-term Care Insurance (LTCI) payments on employment and wages of workers in the long-term care (LTC) industry. Specifically, I use the change in the regional premium in 2012 as an exogenous shock to the insurance fee schedule: the change in the unit price of LTCI service ranges from a decrease of 2.8% to an increase of 4.2%. I find no increase in the number of employees in the establishments, registered under the LTCI scheme, in municipalities where the regional premium increased. The earnings and working hours of LTC workers did not increase, either.
    Keywords: long-term care insurance, care workers
    JEL: I11 J30 J48
    Date: 2019–05
  19. By: Miguel Sánchez-Romero; Ronald D. Lee; Alexia Prskawetz
    Abstract: We propose a general analytical framework to model the redistributive features of alternative pension systems when individuals face ex ante differences in mortality. Differences in life expectancy between high and low socioeconomic groups are often large and have widened recently in many countries. Such longevity gaps affect the actuarial fairness and progressivity of public pension systems. However, behavioral responses to longevity and policy complicate analysis of possible reforms. Here we consider how various pension systems would perform in a general equilibrium OLG setting with heterogeneous longevity and ability. We evaluate redistributive effects of three Notional Defined Contribution plans and three Defined Benefit plans, calibrated on the US case. Compared to a benchmark non-redistributive plan that accounts for differences in mortality, US Social Security reduces regressivity from longevity differences, but would require group-specific life tables to achieve progressivity. Moreover, without separate life tables, despite apparent accounting gains, lower income groups would suffer welfare losses and higher income groups would enjoy welfare gains through indirect effects of pension systems on labor supply.
    JEL: H55 J1 J11 J14 J18 J26
    Date: 2019–06
  20. By: Costa-Font, Joan (London School of Economics); Cowell, Frank A. (London School of Economics)
    Abstract: Approaches to measuring health inequalities are often problematic in that they use methods that are inappropriate for categorical data. The approach here focuses on "pure" or univariate health inequality (rather than income-related or bivariate health inequality) and is based on a concept of individual status that allows a consistent treatment of such data. We use several versions of the status concept and apply methods for treating categorical data to examine self-assessed health inequality for the countries contained in the World Health Survey; we also use regression analysis on the apparent determinants of these health inequality estimates. Our findings indicate major differences in health-inequality rankings depending on the status concept. We find evidence that health inequalities vary with median health status alongside indicators of institutional performance.
    Keywords: health inequality, categorical data, entropy measures, health surveys, upward status, downward status
    JEL: D63 H23 I18
    Date: 2019–05
  21. By: Banuri, Sheheryar; Keefer, Philip; Walque, Damien de
    Abstract: A booming literature has argued that mission-based motives are a central feature of mission-oriented labor markets. This paper shifts the focus to task-based motivation and finds that it yields significantly more effort than mission-based motivation. Moreover, in the presence of significant task motivation, mission motivation has no additional effect on effort. The evidence emerges from experiments with nearly 250 medical and nursing students in Burkina Faso. The students exert effort in three tasks, from boring to interesting. In addition, for half of the students, mission motivation is present: their effort on the task generates benefits for a charity. Two strong results emerge. First, task motivation has an economically important effect on effort. Second, mission motivation increases effort, but only for mundane tasks and not when the task is interesting. Moreover, even for mundane tasks, the effects of mission motivation appear to be less than those of task motivation.
    JEL: H83 J45 C91
    Date: 2019–06
  22. By: Luís Sá; Luigi Siciliani; Odd Rune Straume
    Abstract: We develop a dynamic model of hospital competition where (i) waiting times increase if demand exceeds supply; (ii) patients choose a hospital based in part on waiting times; and (iii) hospitals incur waiting time penalties. We show that, whereas policies based on penalties will lead to lower waiting times, policies that promote patient choice will instead lead to higher waiting times. These results are robust to different game-theoretic solution concepts, designs of the hospital penalty structure, and patient utility specifications. Furthermore, waiting time penalties are likely to be more effective in reducing waiting times if they are designed with a linear penalty structure, but the counterproductive effect of patient choice policies is smaller when penalties are convex. These conclusions are partly derived by calibration of our model based on waiting times and elasticities observed in the English NHS for a common treatment (cataract surgery).
    Keywords: hospital competition, waiting times, patient choice, differential games
    JEL: C73 H42 I11 I18 L42
    Date: 2019
  23. By: Ghosh, sudeshna
    Abstract: This paper explores the ‘globesity’ hypothesis that is, it examines, the effect of globalization in its social and economic dimensions on the obesity of the nations. The study utilized a panel set of Asian countries dividing it into two groups based on the income classification. The annual time period of data series runs from 1985 to 2015. For the low and low middle income countries economic and social globalization positively affects obesity, implying the benefits of globalization leads to adverse impact on health. This is due to life style changes, availability of processed food and lack of public awareness. However, for the richer Asian nations globalization, particularly in its social dimension has negative impact on obesity. The study employs the Westerlund cointegrating techniques to investigate upon the long run causal association between obesity and globalization
    Keywords: Obesity; Health; KOF index; Social globalization; Economic globalization; Asia, Granger Causality.
    JEL: C1 I00
    Date: 2017–10–10
  24. By: Martinez, Sebastian; Bernal, Pedro
    Abstract: Maintaining high standards of care from doctors, nurses and other health professionals is of critical importance for an effective and efficient health system. Yet deficient levels of health worker performance, including low effort, absenteeism, and lack of compliance with clinical guidelines, have been documented across numerous countries and contexts. In response, various pay-for-performance interventions that reward providers based on measures of quality of care and health outcomes have been tested, with mixed results. This study experimentally evaluates the effects of team in-kind incentives on health worker performance in El Salvador. Thirty-eight out of 75 community health teams were randomly assigned to receive in-kind incentives linked to performance over a 12-month period. All 75 teams received monitoring, performance feedback and recognition for their achievements, allowing us to isolate the impacts of the incentive. While both treatment and control groups exhibit improvements in performance measures over time, the in-kind incentives generated significant improvements in community outreach, quality of care, timeliness of care, and utilization of services after 12 months. Contrary to conventional knowledge, gains are largest for health teams at the bottom and top of the baseline performance distribution. These results suggest that even small in-kind incentives can be a powerful tool to improve health worker performance and may be a viable alternative to monetary incentives in certain contexts.
    JEL: I12 C93 I18 I15
    Date: 2019–06

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