« More on health insurance mandates | Main | Fun debates »
The economics of malaria net distribution
In 2000, a world health conference in Abuja, Nigeria, set a goal: by 2005, 60 percent of African children would be sleeping under nets. By 2005, only 3 percent were.
It turns out that handing nets out for free works much better than branding them, marketing them, and selling them, albeit at subsidized prices. And when there are enough insecticide-laden nets in a village, mosquitoes avoid the place altogether (after the very first net, however, the mosquitoes simply move on to another nearby hut).
The sad fact is that the best insecticide-filled nets last no more than three to five years. And is this good or bad news?
...sales of malaria pills were way down.
Here is the full and fascinating story. Eternal vigilance is the price of foreign aid, or something like that...
Posted by Tyler Cowen on October 9, 2007 at 08:16 AM in Economics | Permalink
Comments
Dropping malaria pill sales is good news from my prespective. Unlike developed countries Africa ddoesn't have a vigorous counterfiet drugs program and nor can it's citizens distinguish without a costly marketing campaign.
Nets are easier to inspect for quality(look ma, no holes) and have lower marginal costs per user than pills.
I am puzzled that nets don't sell for a price. Is the average african so poor that he can't afford a mosquito net which can increase his life expectancy by many years, but which he uses for free. There is some signalling going on in the village communities as well although I can't put my finger on it.
Also, the most important question what happens to nets after they are dumped?
Posted by: sa at Oct 9, 2007 9:16:10 AM
This Cornell PhD candidate has a job market paper on a related topic
here is the paper itself
http://www.people.cornell.edu/pages/veh4/intra_hh.pdf
Posted by: Bob at Oct 9, 2007 9:57:27 AM
What are your thoughts about the possibly more effective way to treat malaria - DDT?
Posted by: Steven at Oct 9, 2007 10:27:02 AM
The following paper is also relevant (although related to a different product). The results are somewhat inconclusive but the paper does highlight that there may be a large gap between using a net and saying you are using a net. This will be particularly true when the survey to ascertain usage is undertaken by the same group providing the net for free.
http://www.hbs.edu/research/facpubs/workingpapers/papers0607.html#07-034
Posted by: GS at Oct 9, 2007 11:22:47 AM
I've long been sceptical of both mosquito nets and indoor spraying, noting that people go outside from time to time!!!
However, if you reach a critical mass and mosquitos avoid the village altogether as a result, then that is a horse of a different color. Hopefully this is true instead of mere politically correct propaganda from those who are ideologically opposed to DDT spraying outdoors in an attempt to eradicate the damn parasites once and for all.
Posted by: happyjuggler0 at Oct 9, 2007 11:37:29 AM
I spent 6 months in Liberia (West Africa) as a UN Observer. The place was ravaged by decades of war. Unemployment was/is 85%, Per Capita GDP is $180. Police officers (a job that requires a high school diploma) made between $35 to $80 a month. A 50kg bag of rice, their staple food, is $20 a bag and lasts the average family of 6-10 about 3 weeks. Mosquito net programs in this country are free.
The distribution of free nets was incredible! The aid organizations reached about 80% of the towns I visited (over 100). However, usage varied. The people who received nets often sold them at markets so that they could buy other things today (this also applied to tools/equipment given to towns under agricultural improvement initiatives/occupational training, among other things). Where I was, there were two prevailing mantras: 1) Get rich or die tryin' (they really did love 50 Cent in Liberia, those t-shirts were a status symbol), and 2) Focus on what I can get today, because tomorrow may never come. I also learned that mosquito nets make great veils and fishing nets.
What struck me as odd is that if the people really wanted something, they'd find a way to get money to buy it. They manage to buy $50-200 cell phones and $800 motorcycles, why wouldn't they be willing to buy a $1 mosquito net to prevent malaria? Is it that they don't care, or that they expect to get them for free?
Posted by: SO at Oct 9, 2007 12:37:23 PM
For SO who said:
"What struck me as odd is that if the people really wanted something, they'd find a way to get money to buy it. They manage to buy $50-200 cell phones and $800 motorcycles, why wouldn't they be willing to buy a $1 mosquito net to prevent malaria? Is it that they don't care, or that they expect to get them for free?"
I think that in a lot of countries with what I would consider relatively low probabilities of surviving to the next year, people tend to put more focus on short-term things. Likewise in places with unstable economies, the focus tends to be on the very short term.
I have witnessed these biases in South America and Africa. US and Europe tends to have longer term perspective of things.
It's not that they expect them for free, just that they see limited utility if they're just going to die from something else anyway.
Posted by: Tony K at Oct 9, 2007 2:18:33 PM
Tony:
True. That also explains why they were eating the seed rice.
Posted by: SO at Oct 9, 2007 2:57:12 PM
DDT?
Thanks to american and european enviromentalist if you tried to use it you would be called at least a murderer. No matter if malaria kill more people than aids
Posted by: jean at Oct 9, 2007 3:10:16 PM
No, it's thanks to American and European environmentalists that more people haven't died of malaria, because banning the agricultural use of DDT slowed the development of resistance which has made DDT ineffective in many parts of the world.
Posted by: Jim at Oct 9, 2007 5:35:11 PM
I find it very sad to read that the goal for the net distribution was not met by the African governments. I think that it would be better to give the nets out for free rather than spending money on health care for the children that will get malaria because of no nets. Even though the opportunity cost would be the money the governments could make from marketing the nets, I feel that in the long run it will help out the economies of the countries in Africa and overall make it safer for the children. The malaria pill sales went down because the demand for them went down as well. People have free anti- mosquito nets, so why would they buy pills? And even though the nets might last three to five years, logically one could think that there will be healthier people living in Africa, and hopefully there would be more job opportunities for these people, possibly making future nets when the old ones wear out.
Posted by: SM at Oct 9, 2007 5:59:49 PM
When I read about malaria prevention programs I can not help but wonder why a malaria vaccine was not developed decades ago. From what I understand it is easily achievable and since 2000, when the effort was funded, there has been a lot of progress and several are ready for testing. An estimated 300 - 500 million new malaria infections occur per year, resulting in more than 1.2 million deaths annually and billions have been spent on aid, yet no one saw fit to put money into vaccine development. It is not just the poor in Africa that have trouble with planning for the long run.
Posted by: joan at Oct 9, 2007 7:13:13 PM
[They manage to buy $50-200 cell phones and $800 motorcycles, why wouldn't they be willing to buy a $1 mosquito net to prevent malaria? Is it that they don't care, or that they expect to get them for free?]
remember that lots of Africans have pretty good resistance to the local strain of malaria. An otherwise healthy young man or woman (who I would guess is the market for cell phones and motorbikes) in an urban or semi-urban area isn't necessarily going to want a mosquito net over his or her bed, not least because they are really quite uncomfortable on hot or stuffy nights. The priority for bed nets is children, old people and pregnant women.
Posted by: dsquared at Oct 10, 2007 3:49:55 AM
"remember that lots of Africans have pretty good resistance to the local strain of malaria."
The prevalence of malaria is 25% where I live in Liberia. That means that 1/4 of the country is laying on the floor with a fever on any given day. Hard to see how that's "pretty good".
Posted by: at Oct 10, 2007 8:43:39 AM
Very interesting discussion:
SA: You are thinking too much like an economist :)! If the average African can just barely afford a net, that means half can't afford it. There is a strong correlation between malarial infection rates and total lack of money. There are geographically large areas of Africa that are the main reservoirs for the disease where there is virtually no cash economy. Selling the nets in the absence of a cash economy is problematic.
I've written a fairly extensive post outlining some of these problems:
http://gregladen.com/wordpress/?p=1460
GS: Not really. Increasing a price or charging a price (in the particular setting of the paper you cite) increases the rate of use among buyers, but it does so by screening out those who will not use it. This actually has the net effect of decreasing the total number who will use it.
Also, there is a strong cultural understanding linking the mosquito to the disease across Africa, but not so much with water born illnesses. So I would expect the psychology to be different. Furthermore, I question if the urban setting will be the same as a rural setting both culturally and in relation to the fact that urban settings tend to have a cash economy but rural settings can have as little as zero actual cash circulating ... so analysis of pricing effects are utterly meaningless.
Happy Juggler: The mosquito that transmits malaria is nocturnal and not gregarious, and easily identified by sight by people who understand that it is a deadly animal. In affected areas of Africa, the normal pattern is for people to become become very vigilant of these mosquitos as evening comes on. Any such insects that show up die. The mosquitos that bite people do so later when they are sleeping. So yes, in the cultural, behavioral, and ecological context of tropical Africa, one would expect nets to work, and they do.
SO and others: There are huge differences across the continent in urban vs. rural, even between countries in how much of either is populated. You make good points but of course it isn't really true that a typical Liberian can get whatever he wants if he really wants it. What if he really wants a Humvee? Or to not have his child get malaria?
Joan: regarding vaccine ... unfortunately, it simply is not the case that a vaccine is easily developed. There is no good reason why one would not already exist if so, as more research has gone into the development of a malarial vaccine than any other vaccine in history. There are biological and technical reasons for this. The reason you often read that "the vaccine is near" is because this is very very big business, and no one working on a vaccine is going to put out a press release saying "We are utterly despondent.. there is no hope for this working" But every time there is hope, you hear about that.
Posted by: Greg Laden at Oct 10, 2007 10:03:32 AM
On ddt, read Julen simon Ultimate resource II about false claims made by enviromentalist killing people in the third world
Posted by: jean at Oct 10, 2007 2:46:01 PM
Jean: For what purpose? As a foray into historical fiction?
Posted by: Greg Laden at Oct 10, 2007 2:57:41 PM
What Greg means, Jean, is that Julian Simon is a propagandist, not somebody who tells the truth about public health. See: Julian Simon's DDT deceit.
Posted by: Mike Huben at Oct 10, 2007 4:49:18 PM
" Critiques Of Libertarianism" ... Nice site, Mike. Lots of good stuff over there.
Posted by: Greg Laden at Oct 10, 2007 8:13:40 PM
The NYTimes article referenced by Tyler misrepresented the evidence about effective strategies to increase coverage of insecticide-treated bednets.
The preponderance of evidence shows that to achieve and maintain high rates of coverage free giveaways via campaigns should be targeted, and should be accompanied by complementary efforts at marketing (to increase demand) and efforts to develop the commercial markets (reducing taxes and tariffs on related inputs, promoting competition through procurement and the like).
Fortunately, both the WHO and the Roll Back Malaria Initiative (the lead technical agencies in the field) have come to the same conclusions, and they have issued technical guidelines that reflect this consensus.
Regrettably, many influential actors (e.g. Jeffrey Sachs - see http://www.alliancemagazine.org/free/html/sep05f.html) in global health are either uninterested in the evidence, or too busy (hobnobbing with Angelina?) to familiarize themselves with it. And hence the general public are misled.
Links to the policy guidelines, and more elaborated comments on this issue can be found in my blog entry at the CGD Global Health blog.
http://blogs.cgdev.org/globalhealth/2007/10/battle_over_bednets_1.php
To Jean - I am happy to report that the WHO guidelines have recently been amended to support the use of DDT in indoor residual spraying, and it is increasingly being used in malaria control campaigns.
Posted by: April at Oct 11, 2007 10:01:43 PM
April,
You sort of have a point, but no, the article in the NYT does not say anything very different than what you are saying here, if you actually read the article from beginning to end and pay attention.
Happy about spreading around DDT? Maybe it will work and perhaps it is needed, but I don't think you would be very happy were it happening in your very own bedroom.... I mean, really...
Posted by: Greg Laden at Oct 11, 2007 10:27:36 PM
The article is not full as is claimed in the post as it does a meager job in looking at the other side and it is hard to evaluate the positions taken. One of the claims made is that “There has been a paradigm shift,” Dr. Olumese said. “We need to use the momentum we have right now.” But is that the case of is it business as usual with the same old paradigms. The immediacy of the issue would argue for direct action without complications of entrepreneurial marketing and distribution but is it that simple or is there a place for the social marketing approach and the goal of empowerment? Providing another perspective is Jacqueline Novogratz who has implemented on the ground solutions. The first video is from 2005, the second is from 2007. The first video is misnamed, it goes beyond Africa. The issue of nets is covered more fully under confluence of health and enterprise in the second video.
Talks Jacqueline Novogratz: Investing in Africa's own solutions http://www.ted.com/index.php/talks/view/id/91
Talks Jacqueline Novogratz: Tackling poverty with "patient capital" http://www.ted.com/talks/view/id/157
Posted by: BrianDRPM at Oct 11, 2007 11:45:26 PM
Brian:
One thing to keep in mind, that may make it at least feel a little better, is that this is a many-decades long situation. The net impregnation and distribution idea is brand new, in the long view of anti-malaria efforts. If over the next year most of the money that is allocated to buy nets is actually used to purchase nets, and most of those nets get into use in malaria areas Regardless of how they get there), then that will the the first time in the history of funding an anti malaria program where more than a about 10 or 15 percent of the funds were used for the actual work rather than promotion, consulting, higher-ups taking expensive vacations, etc. etc.
Curing or fighting malaria helps the little brown people. There is no watchdog in the US or Europe making sure that most anti-malaria money is not stolen or misused before it gets into the field or into the lab, so, Free Market Forces being what they are, most of the money is in fact misused or stolen.
IF you used half the available money to buy/make the nets, and dropped them all from a high-flying airplane roughly over the malarial areas, and let the rest sort itself out, you would be doing better than the programs designed by economists, advised by scientists, and administered by bureaucrats.
One of the great fallacies of the "market" distribution method is the assumption that a good will not generate a price unless a government official or economist puts a price on it. If yu want to know how to spread this stuff around, use the model that the Pharmacy companies use to dump their old vials of injectables that are overdate and would otherwise cost money to eliminate. Show up in Kinshasa with a barge full of mosquito nets, leave it unguarded for a month, and pretty soon everyone will have a mosquito net.
Anything, anything, but planning it all out with consultants and expensive lunches and costly reports!
(OK, maybe I'm being slightly over cynical)
Posted by: Greg Laden at Oct 12, 2007 7:29:42 AM
Greg,
First off thanks for the response. Also checked out your blog and was impressed. You would seem to be working at a technical level a number of levels deeper than my college anthropology class. My own view is that is is very beneficial for us to have those with technical knowledge in other fields provide input to the discussion in other realms. Second you may be being too cynical but perhaps not that skeptical. A few points for consideration - my own included with the caveat that I might be being too optimistic.
I would agree with your assessment if we limit the scope of the analysis to one large governmental bureaucratic institution interacting with another. As you point out, one criticism often laid upon these efforts is that this aid helps corrupt governments and little gets to the people who need it. Here is another source of information which addresses both your point that the foreign aid a country receives lands in the pockets of corrupt officials. and the position I wish to put forward . http://mitworld.mit.edu/video/395/ (I can't seem to make links in these posts perhaps because I am using a freebie blogger) This is were I am perhaps being too optimistic but arguably this does not apply to organizations like Acumen Fund which emphasizes sustainable bottom-up solutions over traditional top-down aid. If the nets are actually made in Africa there is less need to my mind for "parental" oversight by outside agencies.
I fully agree with you that one of the great fallacies of the "market" distribution method is the assumption that a good will not generate a price unless a government official or economist puts a price on it. There is however still an allocation of resources in terms of cost and a value. I am not arguing that the recipients should pay either the cost or any assumed profit value but a system of sustainable distribution should recognize these factors. This approach does more than take a band-aid (albeit a really big and important band-aid) approach helping the sick and poor become just poor.
I do have to admit though that this approach does arguably have its limitations in being able to achieve "market penetration" to the degree required because the enterprise can only grow or produce so fast which may not be fast enough for the health need. Assuming the mind set of a "change agent" with the best of intentions, one needs to manufacture the nets, if not in the country of need then transport the nets, and distribute the nets. I can use a lump sum charity donation in the form of foreign aid but then you have the issue of the bureaucracy tied to the money. Golden Rule - He who has the gold makes the rules. Even if I use your distribution system of showing up in Kinshasa with a barge full of mosquito nets, left unguarded for a month, one still has to consider the first two steps. You don't really get to do "regardless of how they get there". Furthermore, I have to wonder if there wouldn't be the equivalent of the mosquito net scalper arising out of all of this. There is no perfect system and much (most) of what goes on could be a hell of a lot better but hopefully things can get better through new technology and new thinking.
Brian
Posted by: BrianDRPM at Oct 12, 2007 2:22:20 PM
Last chaos Gold
Buy Last Chaos Gold
Cheap Last Chaos Gold
Posted by: aion kina at Mar 19, 2009 10:27:03 PM
