Menu Close

Labor and Population Program Working Paper

Citation

Dow, William H. (1995). Labor and Population Program Working Paper. Santa Monica, Calif.: RAND.

Abstract

Despite large investments in determining the demand effects of raising health care user fees in developing countries, there has been little welfare analysis of user fees. Conventional wisdom assumes that the more that user fees discourage demand, the worse is a user-fee policy. This paper shows that this conventional wisdom is contradicted by neoclassical analysis. It is then argued that empirically resolving these conflicting predictions using standard consumer surplus measurement is inadequate. This is because market imperfections make individual private revealed values potentially different from actual social benefits. An alternative "health-valuation" approach to social welfare measurement is proposed here instead. This involves a reorientation of analyses towards direct measurement of health outcome effects, which is argued to be the preferred research strategy.

Reference Type

Report

Book Title

Labor and Population Program Working Paper

Author(s)

Dow, William H.

Year Published

1995

Publisher

RAND

City of Publication

Santa Monica, Calif.

Reference ID

1282