The Social Welfare Model for Equity by Fleurbaey and Schokkaet (2009)

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3.2.3.3 The social welfare model for equity by Fleurbaey and Schokkaet (2009)

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income and socioeconomic as well as demographic background which is outside the control of individual.

Fleurbaey and Schokkaet (2009), proposed methods of estimating socioeconomic and other causes of unfair inequalities using three steps; in step one they constructed a structural model to estimate the relative importance of the different causes of inequality and to get a better insight into their possible interactions. Step two shows the normative aspect where one decides which of the causes of inequality lead to legitimate and which leads to the illegitimate or unfair inequalities. The third step involves the measurement of these unfair inequalities. Given these three steps, the overall policy objective is to minimise unfair inequalities (inequity) in welfare. In achieving this, Fleurbaey and Schokkaet (2009) formulated a structural model of welfare maximisation which minimises unfair inequality (inequity) in health and health care using the outlined steps.

The structural model

The structural model by Fleurbaey and Schokkaet (2009) is developed on the premise that an individual has a health function;

h_i h



y_i,l_i



y_i is the income of individual and l_i is the lifestyle. The model assumes that the health level hi of individual i is produced by a health technology H (.), which is written as;

h_i H



m_i,c_i,e_i,_i,o_i,s_i



Where mi is a vector of medical care utilisation which can be measured by number of visits, c_i is a vector of consumption of other goods including lifestyle goods (smoking, drinking, and other physical activities). o_i is a vector of job characteristics and si a vector of social economic background characteristics of the individual. e_i is the genetically determined health endowment and єi is a stochastic health stock. It is assumed that the individual behaviour has influence on health through the choices of mi, ci and oi and yi is endogenously determined given the choice variables.

y_i Y



c_i,o_i,h_i,a_i,s_i



………... (3)

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Where ai is the innate productive capacity of the individual, for which she/he can be held responsible. To model the individual choices of mi , ci, and Oi, we assume that individuals maximise a utility function given as;



_{i i i i}



i m c o h

U  , , , ……….. (4)

Individual choices of mi is restricted by the decisions of the policy makers and health professionals as well as the health care system and interregional variation in health care availability, therefore, health care utilisation function can be stated as;

m_i M



z_i,e_i,_i,r_i,s_i



……….. ……… (5) Equation (5) implies that the individual makes his/her choice of consumption of mi from a restricted choice set; the restriction is majorly from the supply side zi. The ei is the health endowment; the є is the stochastic health stock, the ri is a variable that represents insurance coverage.

The individual utility function in equation 5 is assumed to be maximised under a budget constrain;

Pc_i B



M_i,r_i



 y_i T



y_i,c_i

 

 p r_i,e_i



………..(6) The resulting maximisation behaviour can be expressed as a function of the exogenous individual characteristics as follows

m_i m



s_i,a_i,e_i,_i,z_i,I_i,R_i,u_i



………...(7) o_i o



s_i,a_i,e_i,_i,z_i,I_i,R_i,u_i



……….(8) c_i c



s_i,a_i,e_i,_i,z_i,I_i,R_i,u_i



………..………..(9) The values of health, income and actual welfare are endogenously determined. When we introduce the decision variables in the utility function in equations (2) and (3) we get the following reduced form expressions.



_{i i i i i i i i}



R

i H s a e z I R u

h  , , , , , , , ……….(10)



i i i i i i i i



R

i y s a e z I R u

y  , , , , , , , ………..(11)

u_i U^R



s_i,a_i,e_i,_i,z_i,I_iR_i,u_i



………(12) The fairness and the unfairness gap is estimated by grouping the exogenous characteristics of the reduced form equation into five groups; the health endowment which indicate characteristics of needs N = (e, є), the socioeconomic background characteristics S = (a, s), the individual preferences P = (R, U), the available information I and supply side variables z. It is assumed that for a given N,P,I, and z differences in S should not lead to differences in health care utilisation. Therefore,

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differences in S accounts for inequity in health care utilisation which is unfair and illegitimate. If we assume that inequity is estimated beyond the socioeconomic level, it implies that given, N, P, I, and S. z is considered as the supply factor, individuals should not be held responsible for z. but if z is interpreted as differences in regional distribution, it implies that there exists regional inequity in health care utilisation. N however shows the legitimate source of differences that is due to the need variable.

The variable P and I boils down to whether we are considering equality of access, equality of use and equality of informed access. Equality of access holds individuals responsible for P and I, equality of use rejected responsibility for P and I. while the intermediate which is equality of informed access held individuals responsible for their personal choices if these are based on good information. Equality of informed access therefore holds individuals responsible for P but not for I.

To compute the degree of direct unfairness, the legitimate source of difference is removed and then the Lorenz curve is used to measure the unfair inequality. Unfair inequalities or horizontal inequity in health care delivery then relates to the distribution of m in the population. In analysing horizontal inequity in this model, it is assumed that m is a scalar variable.

The model of unfairness/inequity by Fleurbaey and Schokkaet(2009) is a ground breaking model of how inequity is estimated capturing individual responsibility. Given the Nigeria situation, the model by Fleurbaey and Schokkaet(2009) is applicable because most women especially in the northern part of the country do not utilise maternal health care because of the problem of access but due to preference and religious belief. Based on this notion, unfairness/inequity in maternal and child health care utilisation caused by these factors are within the individual's control and therefore utilisation may not be unfair/inequitable. This however raises the question on the soundness of the decisions made by the women on the basis of religion and preferences. Some of the women due to religion may not utilise maternal and child health care services due to religious indoctrination and poverty. Making decisions on the basis of religious, cultural indoctrination and poverty means the individual is not in the right frame of mind to make appropriate decisions that the person will be held responsible for. Therefore differences in utilisation due to religious and cultural beliefs in this respect is not due to individual responsibility as such its influence on health care utilisation will lead to unfair inequality or inequity.

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The issue of information which may be a supply problem raises so many questions about the issue of unfairness in utilisation of maternal and child health care in Nigeria.

In most cases, women from the rural areas do not have information about the availability of health facilities to utilise maternal and child health care services even if they are freely provided. In such situations, there is unfairness/inequity in utilisation.

However, the application of this model is limited in Nigeria as information on variables which determines fairness and unfairness inequality or inequity in utilisation may not be readily available in most health survey data.

In document INEQUITY IN MATERNAL AND CHILD HEALTH CARE UTILISATION IN NIGERIA (página 96-100)