Elsevier

Journal of Health Economics

Volume 43, September 2015, Pages 154-169
Journal of Health Economics

Financial incentives in health: New evidence from India's Janani Suraksha Yojana

https://doi.org/10.1016/j.jhealeco.2015.07.001Get rights and content
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Abstract

This paper studies the health effects of one of the world's largest demand-side financial incentive programmes—India's Janani Suraksha Yojana. Our difference-in-difference estimates exploit heterogeneity in the implementation of the financial incentive programme across districts. We find that cash incentives to women were associated with increased uptake of maternity services but there is no strong evidence that the JSY was associated with a reduction in neonatal or early neonatal mortality. The positive effects on utilisation are larger for less educated and poorer women, and in places where the cash payment was most generous. We also find evidence of unintended consequences. The financial incentive programme was associated with a substitution away from private health providers, an increase in breastfeeding and more pregnancies. These findings demonstrate the potential for financial incentives to have unanticipated effects that may, in the case of fertility, undermine the programme's own objective of reducing mortality.

JEL classification

I12
I15
I18

Keywords

Cash incentives
Demand-side financing
Health-seeking behaviour
Maternal health
India

Cited by (0)

We thank Arnab Acharya and Marcos Vera-Hernandez for helpful comments on an earlier draft of this article. We are grateful to Billy Stewart for his guidance and support during this project. This study was funded by UKaid from the Department for International Development. The views expressed do not necessarily reflect the Department's official policies. All errors are our own.