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Health shocks in Sub-Saharan Africa: are the poor and uninsured households more vulnerable?

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  • Esso-Hanam Atake

    (University of Lome)

Abstract

Background In developing countries, health shock is one of the most common idiosyncratic income shock and the main reason why households fall into poverty. Empirical research has shown that in these countries, households are unable to access formal insurance markets in order to insure their consumption against health shocks. Thus, in this study, are the poor and uninsured households more vulnerable from health shocks? We investigate the factors that lead to welfare loss from health shocks, and how to break the vulnerability from health shocks in three Sub-Saharan Africa (SSA) countries, namely, Burkina Faso, Niger and Togo. Methods This study focusses on 1597 households in Burkina Faso, 1342 households in Niger and 930 households in Togo. A three-step Feasible Generalized Least Squares (FGLS) method was used to estimate vulnerability to poverty and to model the effects of health shocks on vulnerability to poverty. Results The estimates of vulnerability show that about 39.04%, 33.69%, and 69.03% of households are vulnerable to poverty, in Burkina Faso, Niger, and Togo respectively. Both interaction variables, ‘health shocks and wealth’ and ‘health shocks and access to health insurance’ had a significant negative effect on reducing household’s vulnerability to poverty. Poverty is the leading cause of economic loss from health shocks as the poorer cannot afford the purchase of sufficient quantities of quality food, preventive and curative health care, and education. We found that lack of health insurance coverage had a significant effect by increasing the incidence of welfare loss from health shocks. Moreover, household size, type of health care used, gender, education and age of the head of the household as well as the characteristics of housing affect vulnerability to poverty. Conclusion Our findings suggest that for the poor households, reduction of user fees of health care at the point of service or expansion of health insurance could mitigate vulnerability to poverty. Other challenges—birth control policy, adequate sanitation facilities and a universal basic education program—need to be addressed in order to reduce significantly the effects of health shocks on vulnerability to poverty in SSA.

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  • Esso-Hanam Atake, 2018. "Health shocks in Sub-Saharan Africa: are the poor and uninsured households more vulnerable?," Health Economics Review, Springer, vol. 8(1), pages 1-13, December.
    • Handle: RePEc:spr:hecrev:v:8:y:2018:i:1:d:10.1186_s13561-018-0210-x
    DOI: 10.1186/s13561-018-0210-x
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    4. Bekhzod EGAMBERDIEV, 2021. "Household Impact Of The Covid-19 Pandemic From A Development Economics Perspective - A Review," Regional Science Inquiry, Hellenic Association of Regional Scientists, vol. 0(1), pages 15-30, June.
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    7. Amina Ika Micah, 2022. "Three essays on access to credit and financial shock in Nigeria," Economics PhD Theses 0422, Department of Economics, University of Sussex Business School.
    8. Davidmac O. Ekeocha & Chimere O. Iheonu, 2021. "Household‐level poverty, consumption poverty thresholds, income inequality and quality of lives in sub‐Saharan Africa," African Development Review, African Development Bank, vol. 33(2), pages 234-248, June.
    9. Olukemi I. Lawanson & Dominic Ikoh Umar, 2021. "The life expectancy–economic growth nexus in Nigeria: the role of poverty reduction," SN Business & Economics, Springer, vol. 1(10), pages 1-26, October.
    10. Séverin Aimé Blanchard Ouadika, 2020. "Health shocks and vulnerability to poverty in Congo," Palgrave Communications, Palgrave Macmillan, vol. 7(1), pages 1-8, December.
    11. Jacob Novignon & Eric Arthur & Kwasi Gyabaa Tabiri & Yaw Boateng Atakorah & Justice Nonvignon, 2024. "Does health insurance mitigate the economic impact of negative health outcomes? Evidence from Ghana’s National Health Insurance Scheme," Journal of Social and Economic Development, Springer;Institute for Social and Economic Change, vol. 26(2), pages 582-602, August.
    12. Egamberdiev, Bekhzod, 2021. "Household Impact of COVID-19 Pandemic in Development: Economic Perspective-A Review," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 0(1), pages 15-30.
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