Borrowing Constraints, Health Care Choices and Health Outcomes

Extent to access to credit is one of the important indicators of socio-economic development of a country,as it affects various livelihood choices in a significant way. The principal objective of this book is to investigate the effect of credit constraints on health care utilizations and health outcomes. This issue has important policy implications, particularly in the rural areas of developing countries, where access to health insurance is very limited. Bosnia- Herzegovina Living Standard Measurement Study Survey 2001 data has been used. Appropriate care has been taken to address the issues of endogeneity of borrowing constraint and the decision process involved in health care utilizations. Using Two Stage Least Square (2SLS) Method and Propensity Score Method, broadly it is inferred that credit constraint is negatively associated (also causality) with health care utilizations and health status. This research was completed in year 2008-09, while I was undertaking a course in Health Economics in Cornell University, U.S.A., under the helpful guidance of Prof. John Cawley.I express heartfelt gratitude to him and Prof.Calum Turvey for continuous guidance and support for this work.