Description:

José Flor Toro (Northwestern University): "Getting health professionals to underserved areas in developing countries: wages, career-incentives, and selection" joint with M. Magnaricotte.

Abstract: Human resources in health are unequally distributed within many developing countries, a factor which contributes to unequal access to health. Since job positions in poor and remote areas are often unattractive to health professionals, governments rely on different incentives to draw professionals to underserved areas. Are these incentives efficient in attracting health professionals and are they ultimately effective in improving health outcomes? We study Peru’s civil service requirement in remote areas for recently graduated health professionals, and two major reforms on the schedule of wages and career incentives for this particular system. We exploit discontinuities in the incentives schedules introduced by the reforms to document two facts. First, while both incentives seem to be effective in attracting health professionals scoring higher in major-specific tests, physicians respond strongly to career incentives and nurses to pay increases. Second, despite observably 'better' health professionals, health outcomes did not improve and in some cases worsened. We argue that this may result from the pattern of selection created by reforms in a system with limited job positions, different incentives, and different types of health professionals beyond what is measured in test scores. We then discuss a framework to quantify these selection patterns by exploiting administrative data and the system's centralized allocation.

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