Inequality Effects for Fiscal Policy: Analysing the Benefit Incidence on Health Sector in India
Publication dateDec, 2015
DetailsNIPFP Working Paper No. 158
AuthorsKausik K. Bhadra
Analysing inequality effect of fiscal policy is an elusive area of research in public economics. Using the unit record data of two recent NSS rounds on health, this paper analyses the benefit incidence of public health spending on inpatient service delivery, categorised by region, gender and economic class. Inpatient morbidity data among quintile-wise MPCE classes across three Indian states – Bihar, West Bengal and Kerala - are examined to decipher whether the benefit incidence of public health expenditure is pro-poor. The concentration curves and computed unit costs followed by polarisation ratios and odds-ratios reveal significant regional and gender differentials in access and utilisation of health services at sub national levels. West Bengal has remained unchanged in both the rounds in case of both the differentials – gender and region while Bihar has shown a significant improvement in bringing down regional differential. Kerala, however, explicate a different scenario where poor ‘voted with feet’ from public sector. The co-existence of private and public service provisioning in health sector may be one of the reasons for this behavioural ‘exit’ in Kerala, however, it is equally interesting to note the ‘voice’ elements when the targeting of public spending is pro-rich.