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Policy makers, the international community and the population in the prevention and treatment of diseases: case study on HIV/AIDS

Author

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  • Kjell Hausken

    (University of Stavanger)

  • Mthuli Ncube

    (St Antony’s College, University of Oxford, Radcliffe Observatory Quarter)

Abstract

A four-period game is developed between a policy maker, the international community, and the population. This research supplements, through implementing strategic interaction, earlier research analyzing "one player at a time". The first two players distribute funds between preventing and treating diseases. The population reacts by degree of risky behavior which may cause no disease, disease contraction, recovery, sickness/death. More funds to prevention implies less disease contraction but higher death rate given disease contraction. The cost effectiveness of treatment relative to prevention, country specific conditions, and how the international community converts funds compared with the policy maker in a country, are illustrated. We determine which factors impact funding, e.g. large probabilities of disease contraction, and death given contraction, and if the recovery utility and utility of remaining sick or dying are far below the no disease utility. We also delineate how the policy maker and international community may free ride on each other’s contributions. The model is tested against empirical data for 43 African countries. The results show consistency between the theoretical model and empirical estimates. The paper argues for the need to create commitment mechanisms to ensure that free riding by both countries and the international community is avoided.

Suggested Citation

  • Kjell Hausken & Mthuli Ncube, 2017. "Policy makers, the international community and the population in the prevention and treatment of diseases: case study on HIV/AIDS," Health Economics Review, Springer, vol. 7(1), pages 1-12, December.
    • Handle: RePEc:spr:hecrev:v:7:y:2017:i:1:d:10.1186_s13561-016-0139-x
    DOI: 10.1186/s13561-016-0139-x
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    References listed on IDEAS

    as
    1. Michael Kremer & Christopher M. Snyder, 2003. "Why Are Drugs More Profitable Than Vaccines?," NBER Working Papers 9833, National Bureau of Economic Research, Inc.
    2. Paul Collier & Olivier Sterck, 2018. "The moral and fiscal implications of antiretroviral therapies for HIV in Africa," Oxford Economic Papers, Oxford University Press, vol. 70(2), pages 353-374.
    3. Till Bärnighausen & Joshua A Salomon & Nalinee Sangrujee, 2012. "HIV Treatment as Prevention: Issues in Economic Evaluation," PLOS Medicine, Public Library of Science, vol. 9(7), pages 1-5, July.
    4. Michael Kremer & Christopher M. Snyder, 2015. "Preventives Versus Treatments," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 130(3), pages 1167-1239.
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    Cited by:

    1. Kjell Hausken & Mthuli Ncube, 2020. "Game theoretic analysis of persons, the pharmaceutical industry, and donors in disease contraction and recovery," Palgrave Communications, Palgrave Macmillan, vol. 7(1), pages 1-17, December.

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    More about this item

    Keywords

    Disease; Policy; Game; Funding; Prevention; Treatment; Resource distribution; Free riding; Risky behavior;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • I10 - Health, Education, and Welfare - - Health - - - General
    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health

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