Health, Economic Growth and Poverty Reduction: Concepts and determinants in Latin America and the Ca

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Health, Economic Growth and Poverty
ReductionConcepts and determinants in Latin
America and the Caribbean

• Juan Antonio Casas, Director
• Division of Health and Human Development
• PAHO/WHO

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Health and Economic Growth
Diego Rivera. Man at the Crossroads, 1934.
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The Income-Health Link

• The average attainable level of health for a
  given level of GDP per capita improves over time
• It becomes less costly and easier to maintain a
  given level of health over time because of
• technological innovation
• investment in public infrastructure
• better educated and informed population
• accumulated nutritional and health gains

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IMR and GDP per capita constant, LAC, 1977, 1987
1998
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The Income-Health Link

• First conclusion
• Improved health is not exclusively a byproduct of
  economic growth and in fact, may improve in the
  absence of growth
• Development strategies based on economic growth
  should incorporate improving health as a strategy
  for achieving better growth
• What is the evidence?

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Latin America Income Growth Associated with
1950-60 Health Improvement
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Health and Economic Policy

• Health impacts growth through
• Human capital accumulation
• Increased saving
• Reduction of inequality, poverty alleviation
• Female economic participation
• Demographics and fertility
• Equity and efficiency of health systems

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Additional research questions

• Can investing in health and in reducing health
  inequalities reduce income inequalities, poverty
  and increase growth?
• What kinds of health services are the most
  efficient way to invest in health?

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Inequality and Poverty in LAC

• Poverty levels are four times that of other
  regions with similar GDP.
• Income concentration is increasing
• Poverty rates have not improved, in some cases
  worsened, since 1980
• Urbanization of poverty
• Growth of informal sector of the economy
• 98 of connectivity limited to 20 highest income
  group

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Increasing income concentration in Latin America
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Poverty in LAC

• Persistent relative and absolute poverty circa
  2000, relatively unchanged since 1980
• 250 millions in relative poverty - 50
• 160 million under poverty line - 33
• 80 million in extreme poverty - 16

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Income Distribution in Six Countries in LAC
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Under five mortality in nine countries of LAC,
circa 2000
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Infant Mortality Rates, by family income groups,
Pelotas, Brazil, 1982 and 1993
Source Victora, C., 1999
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Porcentaje de personas de acuerdo con el acceso
alagua segun decil de gasto per cápita, Perú
1997.
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...
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One example with the survival models
Infant survival curves (estimated) according to
education of the mother water and sanitation
conditions, Peru, 1997
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Policy implications (Bolivia as an example)
Some examples in relation to mortality below age
five

• Given the importance of the socioeconomic status
  on mortality below age five, the State should
  target its policies to the creation of jobs for
  the quintiles of lower incomes, in order to
  guarantee a higher level of consumption in those
  households.
• The Basic Health Insurance in Bolivia should
  expand its package of benefits and incorporate
  the cultural values of indigenous peoples in
  order to improve the coverage of institutional
  childbirth and adequate prenatal care.

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Policy implications (Bolivia as an example)
Some examples in relation to mortality below age
five

• It is important to maintain the habit of
  breast-feeding in Bolivian mothers and to promote
  it in the high quintile mothers, regardless of
  the period of time that this can take.
• There are very young mothers in the strata of low
  income, affecting negatively the distribution of
  child mortality, as a result, the sexual and
  reproductive health programs should orient their
  actions to the young women of poor populations
  and these programs should continue their policy
  to reduce birth rates with the purpose of
  reducing the size of the poor households, given
  their impact on the inequality of mortality in
  the children under 5 years of age.

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Lines of ActionCMH Report as a tool for
advancing research and advocacy

• Relationship between health and economic growth

• Role of health interventions in reduction of
  poverty and inequalities

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Lines of Action Regional and country estimates
of PHC programs and strategies

• Levels and distribution of expenditures on PHC
• Resource constraints

• Identify needs for resource allocation and/or
  mobilization

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Lines of ActionFocus on Burden of Disease of
the Poor

• Identify main health problems of the poor
• Identify cost-effective interventions to include
  in a renewed PHC strategy,

• Intersectoral initiatives at national and
  regional level

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Lines of ActionRegional Commissions of
Macroeconomics and Health

• National Commissions
• Mexico

• Subregional Commissions
• CARICOM
• SICA
• Others

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Lines of ActionHIPC Countries and PRSP

• HIPC countries
• Bolivia, Guyana, Honduras, Haiti, Nicaragua
• Country specific packages of interventions

• Data collection and information for needs
  assessment and effective delivery and monitoring

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Final Conclusions

• Health contributes to economic growth
• Health has a place in economic policy decisions
• More theory-aided economic research and
  evaluation is needed to understand the channels
  and magnitudes of the economic and demographic
  impacts of health