Summary and Recall

January 31st 2024

1. Linkages between education & health and
the Economy
• We tried to understand the linkages in the context of the Indian
economy.
• We found that health & education achievements/deprivations can
impact the economy.
• India currently has massive youth unemployment.
• Urban and rural female youth are doubly disadvantaged. They are
leaving the labour force altogether.
• Low levels of education and health achievements are impacting
individual as well as nation’s productivity.
2. Special characteristics of healthcare market
• The microeconomic framework of perfectly competitive markets has
limitations of assumptions for understanding healthcare markets.
• Healthcare as a commodity is different from normal private goods as
it has some special characteristics on both the demand and supply
side.
• Doctor-Patient agency relationship
• Huge externalities (and therefore a public good)
• Government interventions are a norm than exception
3. Health achievements – Human right or
investment
• Good health is not just an investment but also a human right.
• Government spending on health/healthcare is not an option but a
compulsion.
• Countries such as India, that have Welfare State characteristics, have
an intrinsic motivation for spending on health and education.
Government spending directly impacts the capabilities of a nation.
• Public health, primary & secondary education, and even higher
education have global public good characteristics. They cannot be
restricted to only individual demand functions.
4. Social identities matter!
• Geographical location (rural, urban, remote, island, riverine areas)
• Caste/Tribe/Race
• Religion
• Gender/Sex
• Income

People of different social identities experience and perceive poverty

differently.
5. Democracy matters!
• Governments (Democratic or autocratic)
Experience shows that democratic countries have better human
development achievements

• Governance structures (Centralist or federal)

Experience shows that decentralized governance structures implement
policies and programmes better