Essays on Health-Related Problems and Consequences on Household Economic Outcomes in Ethiopia

In the first chapter, we discuss the impact of death and illness on household income and non-health consumption for the overall sample and subsamples. With a few exceptions, the results suggest that the insurance mechanism in the country does not fully insure household income and consumption against death and illness. Following death or illness experience, almost all household groups suffer from a decrease in consumption of one or more items and/or earned income. The second chapter examines households' choice of coping strategies after deaths and illness in the overall sample and different subsamples. The results show that Ethiopian households as a whole, urban, female-headed, and non-poor households experiencing death resort to the sale of assets, supplemented by the use of additional work, and other aggregate coping strategies. Similarly, rural, male-headed and poor households tend to jointly use additional work and other aggregate coping strategies following death. Households as a whole, and in subsamples, tend to jointly use the sale of productive assets, help particularly from individuals, and credit to cope with illness experiences. All households use costly coping strategies to cope with death and/or illness. The use of costly coping strategies in the face of death and/or illness may affect long-term welfare. The third chapter focuses on analyzing the prevalence of disability and its effects on household consumption and the decision to enroll in the community-based health insurance scheme. The prevalence rate for disability is as large as 30% of surveyed households. Disability of a severe degree of difficulty affects household consumption of all items, implying both short-run and long-run effects. The result also shows the presence of adverse selection in community-based health insurance. As policy recommendation, we suggest the full-scale operation of the community-based health insurance mandatory for all target households in the informal sector and an immediate roll-out of the legislated social health insurance for individuals in the formal sector. The provision of public health services in the promotion and prevention of public health could prevent the occurrence of health problems and their adverse consequences ex-ante. In addition, well-targeted government social protection programs would protect against household impoverishment following short-term and long-term health problems.