Policies to increase preventive testing in developing countries should include subsidies towards treatment costs.

What Is the Price of Prevention?

New Evidence from a Field Experiment

Edward N. Okeke, Clement A. Adepiti, Kayode O. Ajenifuja

ResearchPosted on rand.org 2013Published in: Journal of Health Economics, v. 32, no. 1, Jan. 2013, p. 207-218

How does increasing access to treatment affect the demand for preventive testing? In this paper we present results from a field experiment in Nigeria in which we offered cervical cancer screening to women at randomly chosen prices. To test our hypothesis, we also offered women a lottery where the payoff was a subsidy towards the cost of cervical cancer treatment (conditional upon a diagnosis of cervical cancer). We find that women randomly selected to receive the conditional cancer treatment subsidy were about 4 percentage points more likely to take up screening than those in the control group. We also show that reducing the price of screening by 10 cents increased take-up by about 1 percentage point. These results offer compelling evidence that the optimal set of subsidies to increase take-up of preventive testing in developing countries, must include subsidies towards treatment costs (in addition to price subsidies).

Key Findings

  • Subsidizing treatment costs increases the demand for preventive testing.
  • Prices matter but only partially.
  • We find some evidence that higher prices may help to target services to higher risk individuals.

Recommendation

  • Policies to increase preventive testing in developing countries should include subsidies towards treatment costs.
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Topics

Document Details

  • Copyright: Elsevier B.V
  • Availability: Non-RAND
  • Year: 2013
  • Pages: 12
  • Document Number: EP-51282

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