Economics 172 Issues in African Economic Development Lecture 8 February 9, 2006.
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Transcript of Economics 172 Issues in African Economic Development Lecture 8 February 9, 2006.
![Page 1: Economics 172 Issues in African Economic Development Lecture 8 February 9, 2006.](https://reader030.fdocuments.in/reader030/viewer/2022020417/56649f145503460f94c283ff/html5/thumbnails/1.jpg)
Economics 172Issues in African Economic Development
Lecture 8
February 9, 2006
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Economics 172 2
Outline:
(1) Deworming in Kenya – public health policy issues
(2) New topic: The Economics of HIV/AIDS in Africa
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Economics 172 3
Cost-benefit calculations
• Cost of this program: US$1.46 per pupil per year• Cost of a larger-scale program in neighboring Tanzania:
only US$0.49 per pupil per year
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Economics 172 4
Cost-benefit calculations
• Cost of this program: US$1.46 per pupil per year• Cost of a larger-scale program in neighboring Tanzania:
only US$0.49 per pupil per year
• Deworming as a human capital investment:
Health gains More schooling Higher adult wages
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Cost-benefit calculations
• Deworming as a human capital investment:
Health gains More schooling Higher adult wages
• Deworming led to 7% gain in school participation• Previous study: each year of school 7% higher wages• Take these gains in wages (7% x 7%) over 40 years in
the workforce, discounted 5% per year
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Cost-benefit calculations
• Deworming as a human capital investment:
Health gains More schooling Higher adult wages
• Deworming led to 7% gain in school participation• Previous study: each year of school 7% higher wages• Take these gains in wages (7% x 7%) over 40 years in
the workforce, discounted 5% per year
Deworming benefits are at least three times (3x) as large as treatment costs (using the Tanzania costs)
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Given the returns, why is take-up not 100%?
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Given the returns, why is take-up not 100%?
• Possible explanations:
(1) Free-riding / externalities
-- Strong evidence people learned through their social network that the drugs were “not effective”
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Economics 172 9
Given the returns, why is take-up not 100%?
• Possible explanations:
(1) Free-riding / externalities
-- Strong evidence people learned through their social network that the drugs were “not effective”
(2) Socio-cultural explanations / resistance to new technologies (evidence from anthropology)
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The Impact of Higher Drug Costs
• In 1998, 1999, 2000 deworming was given for free• In 2001, parents in 25 randomly chosen Group 1 and
Group 2 schools paid US$0.10-0.30 per child
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The Impact of Higher Drug Costs
• In 1998, 1999, 2000 deworming was given for free• In 2001, parents in 25 randomly chosen Group 1 and
Group 2 schools paid US$0.10-0.30 per child
• 2001 deworming take-up:
Free-treatment schools: 75%
Cost-sharing schools: 18%
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Economics 172 13
The Economics of HIV/AIDS in Africa
• Of the 42 million people worldwide thought to be infected with HIV, approximately 25 million (!) are in Sub-Saharan Africa
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The Economics of HIV/AIDS in Africa
• Of the 42 million people worldwide thought to be infected with HIV, approximately 25 million (!) are in Sub-Saharan Africa
• In some countries in southern Africa (e.g. Botswana, Swaziland), it is claimed that over 35% are HIV+
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Counting HIV+ people in Kenya
• Based on antenatal clinic survey data, the official UNAIDS estimate of HIV+ adults in Kenya by late 2001 was 15.0%
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Economics 172 18
Counting HIV+ people in Kenya
• Based on antenatal clinic survey data, the official UNAIDS estimate of HIV+ adults in Kenya by late 2001 was 15.0%
• The 2003 Kenya Demographic and Health Survey (DHS) tried to survey a representative subsample of population. 73.4% agreed to be tested
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Economics 172 19
Counting HIV+ people in Kenya
• Based on antenatal clinic survey data, the official UNAIDS estimate of HIV+ adults in Kenya by late 2001 was 15.0%
• The 2003 Kenya Demographic and Health Survey (DHS) tried to survey a representative subsample of population. 73.4% agreed to be tested– This data indicates that “only” 6.7% of Kenyan 15-49
year olds tested are HIV+!
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Counting HIV+ people in Kenya
• Based on antenatal clinic survey data, the official UNAIDS estimate of HIV+ adults in Kenya by late 2001 was 15.0%
• The 2003 Kenya Demographic and Health Survey (DHS) tried to survey a representative subsample of population. 73.4% agreed to be tested– This data indicates that “only” 6.7% of Kenyan 15-49
year olds tested are HIV+!
• Which of the two numbers is better?
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Whiteboard #1
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Whiteboard #2
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Whiteboard #3
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Whiteboard #4
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Whiteboard #5
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Map of Africa