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The macroeconomics of targeting: The case of an enduring epidemic

What is the right balance among policy interventions in order to ensure economic growth over the long run when an epidemic causes heavy mortality among young adults? We argue that, in general, policies to combat the disease and promote education must be concentrated, in certain ways, at first on som...

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Published in:	Journal of health economics 2009, Vol.28 (1), p.54-72
Main Authors:	Bell, Clive, Gersbach, Hans
Format:	Article
Language:	English
Subjects:	AIDS AIDS (Acquired Immune Deficiency Syndrome) Bildungsinvestition Disease Outbreaks - economics Economic growth Education Education support Educational programmes Empirical research Epidemic diseases Epidemic diseases, HIV/AIDS, Macroeconomics of targeting, Education support, Health policies Epidemics Generation Gesundheit Health administration Health economics Health Education - economics Health Education - legislation & jurisprudence Health policies Health Policy Health promotion Health Services Needs and Demand - economics HIV HIV Infections - mortality Human capital Humankapital Humans Investition Kosten Macroeconomics Macroeconomics of targeting Models, Econometric Mortality Public health Public policy South Africa Studies
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description	What is the right balance among policy interventions in order to ensure economic growth over the long run when an epidemic causes heavy mortality among young adults? We argue that, in general, policies to combat the disease and promote education must be concentrated, in certain ways, at first on some subgroups of society. This concentration involves what we term the macroeconomics of targeting. The central comparison is then between programs under which supported families enjoy the benefits of spending on health and education simultaneously (DT), and those under which the benefits in these two domains are sequenced (ST). When levels of human capital are uniformly low at the outbreak, DT is superior to ST if the mortality rate exceeds some threshold value. Outside aid makes DT more attractive; but DT restricts support to fewer families initially and so increases inequality. A summary account of the empirical evidence is followed by an application of the framework to South Africa.
doi_str_mv	10.1016/j.jhealeco.2008.07.011
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We argue that, in general, policies to combat the disease and promote education must be concentrated, in certain ways, at first on some subgroups of society. This concentration involves what we term the macroeconomics of targeting. The central comparison is then between programs under which supported families enjoy the benefits of spending on health and education simultaneously (DT), and those under which the benefits in these two domains are sequenced (ST). When levels of human capital are uniformly low at the outbreak, DT is superior to ST if the mortality rate exceeds some threshold value. Outside aid makes DT more attractive; but DT restricts support to fewer families initially and so increases inequality. 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subjects	AIDS AIDS (Acquired Immune Deficiency Syndrome) Bildungsinvestition Disease Outbreaks - economics Economic growth Education Education support Educational programmes Empirical research Epidemic diseases Epidemic diseases, HIV/AIDS, Macroeconomics of targeting, Education support, Health policies Epidemics Generation Gesundheit Health administration Health economics Health Education - economics Health Education - legislation & jurisprudence Health policies Health Policy Health promotion Health Services Needs and Demand - economics HIV HIV Infections - mortality Human capital Humankapital Humans Investition Kosten Macroeconomics Macroeconomics of targeting Models, Econometric Mortality Public health Public policy South Africa Studies
title	The macroeconomics of targeting: The case of an enduring epidemic
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