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Progressivity of Public Spending on Health care at the Sub-state Level in India: An Empirical Investigation in Tamil Nadu and Bihar

Publication date

Mar, 2022


NIPFP Working Paper No. 375


Pritam Datta, Jay Dev Dubey and Mita Choudhury


Progressivity of public spending on health is considered welfare enhancing, and is often quantified through Benefit Incidence Analysis (BIA). In India, BIA analyses have been confined to state-level aggregates, and intra-state variation in progressivity among districts have remained largely unknown due to limited availability of disaggregated data. We use multiple datasets to overcome the data constraint and undertake BIA at the district-level in the two states of Bihar and Tamil Nadu. Disaggregated information from respective state treasuries were combined with central and state samples of surveys conducted by the National Sample Survey Organization to estimate utilisation and incidence of the benefits of public spending in districts. Results highlight that several districts diverge from state-level aggregates on progressivity, and this call for targeted heath interventions at the state-level. Further, a comparison of public spending across vertical tiers of the health pyramid and utilization of health facilities in the two states provide insights on state-level effectiveness of health interventions. The study lays forward a methodological framework to undertake BIA at the district-level in India.
Key Words: Health Financing, Benefit Incidence Analysis, Public Spending on Health, Bihar, Tamil Nadu. India
JEL Classification: H22, I14, I15, I18
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