Price Subsidies, Diagnostic Tests, and Targeting of Malaria Treatment: Evidence from a Randomized Controlled Trial
American Economic Review
vol. 105,
no. 2, February 2015
(pp. 609-45)
Abstract
Both under- and over-treatment of communicable diseases are public bads. But efforts to decrease one run the risk of increasing the other. Using rich experimental data on household treatment- seeking behavior in Kenya, we study the implications of this trade-off for subsidizing life-saving antimalarials sold over-the-counter at retail drug outlets. We show that a very high subsidy (such as the one under consideration by the international community) dramatically increases access, but nearly one-half of subsidized pills go to patients without malaria. We study two ways to better target subsidized drugs: reducing the subsidy level, and introducing rapid malaria tests over-the-counter. (JEL D12, D82, I12, O12, O15)Citation
Cohen, Jessica, Pascaline Dupas, and Simone Schaner. 2015. "Price Subsidies, Diagnostic Tests, and Targeting of Malaria Treatment: Evidence from a Randomized Controlled Trial." American Economic Review, 105 (2): 609-45. DOI: 10.1257/aer.20130267Additional Materials
JEL Classification
- D12 Consumer Economics: Empirical Analysis
- D82 Asymmetric and Private Information; Mechanism Design
- I12 Health Behavior
- O12 Microeconomic Analyses of Economic Development
- O15 Economic Development: Human Resources; Human Development; Income Distribution; Migration