Journal Issue: World Bank Research Observer, Volume 35, Issue 2
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35
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2
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Out-of-Pocket Expenditures on Health
(Published by Oxford University Press on behalf of the World Bank, 2020-07) Eozenou, Patrick; Wagstaff, Adam; Smitz, Marc
This paper provides an overview of research on out-of-pocket health expenditures by reviewing the various summary measures and the results of multi-country studies using these measures. The paper presents estimates for 146 countries from all World Bank income groups for all summary measures, along with correlations between the summary measures and macroeconomic and health system indicators. Large differences emerge across countries in per capita out-of-pocket expenditures in 2011 international dollars, driven in large part by differences in per capita income and the share of GDP spent on health. The two measures of dispersion or risk—the coefficient of variation and Q90/Q50—are only weakly correlated across countries and not explained by our macroeconomic and health system indicators. Considerable variation emerges in the out-of-pocket health expenditure budget share, which is highly correlated with the incidence of “catastrophic expenditures”. Out-of-pocket expenditures tend to be regressive and catastrophic expenditures tend to be concentrated among the poor when expenditures are assessed relative to income, while expenditures tend to be progressive and catastrophic expenditures tend to be concentrated among the rich when expenditures are assessed relative to consumption. At the extreme poverty line of $1.90-a-day, most impoverishment due to out-of-pocket expenditures occurs among low-income countries.
Human Capital and Macroeconomic Development
(Published by Oxford University Press on behalf of the World Bank, 2020-07) Rossi, Federico
The role of human capital in facilitating macroeconomic development is at the center of both academic and policy debates. Through the lens of a simple aggregate production function, human capital might increase output per capita by directly entering in the production process, incentivizing the accumulation of complementary inputs, and facilitating the adoption of new technologies. This paper discusses the advantages and limitations of three approaches that have been used to evaluate the empirical importance of these channels: cross-country regressions, development accounting, and quantitative models. The key findings in the literature are reviewed and some of them are replicated using updated data. The bulk of the evidence suggests that human capital is an important determinant of cross-country income gaps, especially when its measurement is broadened to go beyond simple proxies of educational attainment. The paper concludes by highlighting policy implications and promising avenues for future work.
Corruption as a Self-Reinforcing Trap
(Published by Oxford University Press on behalf of the World Bank, 2020-07) Stephenson, Matthew C.
Corruption is widely believed to be a self-reinforcing phenomenon, in the sense that the incentive to engage in corrupt acts increases as corruption becomes more widespread. Some argue that corruption's self-reinforcing property necessarily implies that incremental anticorruption reforms cannot be effective, and that the only way to escape a high-corruption equilibrium “trap” is through a so-called “big bang” or “big push.” However, corruption's self-reinforcing property does not logically entail the necessity of a big bang approach to reform. Indeed, corruption's self-reinforcing property may strengthen the case for pursuing sustained, cumulative incremental reforms. While there may be other reasons to prefer a big bang approach to an incremental approach, this conclusion cannot be grounded solely or primarily on corruption's self-reinforcing character.
External Validity and Policy Adaptation
(Published by Oxford University Press on behalf of the World Bank, 2020-07) Williams, Martin J.
With the growing number of impact evaluations worldwide, the question of how to apply this evidence in policy making processes has arguably become the main challenge for evidence-based policy making. How can policy makers predict whether a policy will have the same impact in their context as it did elsewhere, and how should this influence the policy’s design and implementation? This paper suggests that failures of external validity (both in transporting and scaling up policy) can be understood as arising from an interaction between a policy’s theory of change and a dimension of the context in which it is being implemented. The paper surveys existing approaches to analyzing external validity, and suggests that there has been more focus on the generalizability of impact evaluation results than on the applicability of evidence to specific contexts. To help fill this gap, the study develops a method of “mechanism mapping” that maps a policy’s theory of change against salient contextual assumptions to identify external validity problems and suggest appropriate policy adaptations. In deciding whether and how to adapt a policy, there is a fundamental informational trade-off between the strength of evidence on the policy from other contexts and the policy maker’s information about the local context.