How Much Household Healthcare Expenditure Contributes to Poverty? Evidence from the Bangladesh Household Income and Expenditure Survey, 2010

ABSTRACT

Bangladesh’s health finance characterizes by 63.3% out-of-pocket payments and a lack of prepayment mechanism. We assume this heavy burden significantly contributes to poverty. The results indicate, 3.2% of households are not counted as the poor, but in reality, they are. This shows an 8.8% underestimation of poverty. The poverty gap increases from Bangladesh Taka 1,458 to Taka 1,817. Similarly, the mean positive poverty gap rises from 22.2% to 25.2%, indicating that the increase in poverty is not only due to more households being brought into poverty but also deepening of the poverty among those who were already poor.

KEYWORDS:

• Healthcare expenditure
• Poverty
• Contributors of poverty
• Bangladesh
• Household poverty

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1. Jan Pen, a Dutch economist described pen’s parade or the income parade in 1971. The parade is defined as a succession of people in the economy, with their height proportional to their income, and ordered from the lowest to the greatest.