Making Bricks from Straw: Resources and Productivity in Health Care
Abstract
Why do health facilities in developing countries do so poorly? This paper examines the role of financial constraints. I describe an experiment in which we surprised health workers in randomly selected public health clinics in Nigeria with a N600,000 grant paid out in installments over one year. Its administration was left entirely to health workers. I show that the award led to large productivity gains. Using expenditure data combined with novel textual data I provide an explanation for these effects. I show that the award increased investments in physical and human capital, led to lower prices for patients and inspired health workers to do better.
Fields of Study & Subjects
Global Maternal and Child Health
Healthcare Systems and Reforms
Economic Policies and Impacts
Publication details
- Journal / source
- American Economic Review
- Publisher
- American Economic Association
- Volume
- 116
- Issue
- 4
- Pages
- 1499–1539
- Publication date
- 31 March 2026
- Language
- EN