Diseases, infection dynamics, and development

Abstract

We propose an economic theory of infectious disease transmission and rational behavior. Diseases are costly due to mortality (premature death) and morbidity (lower productivity and quality of life). The theory offers three main insights. First, higher disease prevalence implies lower saving-investment propensity. Preventive behavior can partially offset this when the prevalence rate and negative disease externality are relatively low. Secondly, infectious diseases can generate a low-growth trap where income alone cannot push an economy out of underdevelopment, a result that differs from development traps in the existing literature. Since income per se does not cause health in this equilibrium, successful interventions have to be health specific. Thirdly, a more favorable disease ecology propels the economy to a higher growth path where infectious diseases are eradicated. Even so, diseases can significantly slow down convergence to this growth path. Taken together, our results suggest that the empirical relationship between health and income at the aggregate level may be more nuanced than realized.

Intelligence and gender (in)equality: Empirical evidence from developing countries

“…Indeed, related literature reports that infectious disease prevalence significantly impairs the accumulation of cognitive abilities (Ijaz, & Rubino, 2012) and human capital formation (e.g. Schultz, 2003;Chakraborty et al, 2010).…”

Health Cycles and Health Transitions

“…Based on the broad patterns of sub-Saharan Africa's economic development, it has also quantitatively assessed whether and how policy can accelerate growth, eliminate the burden of ill health and improve overall welfare in the developing world. For both purposes, we use a modified version of the general equilibrium model of infectious disease transmission and economic growth presented in Chakraborty et al (2010). The model is sufficiently simple to clearly point out important policy trade-offs, but at the same time rich enough to capture the main features of sub-Saharan Africa's disease ecology and development challenges.…”

The Economic and Demographic Transition, Mortality, and Comparative Development

“…This technical feature permits conducting smooth comparative statics on the main variables of interest, such as baseline longevity, and investigating their role for the differential delays in take-off. In this context, the paper contributes to the few quantitative papers in the literature that investigate the timing of the transition, such as Ngai (2004) and Chakraborty, Papageorgiou, and Sebastian (2010). To our knowledge, this paper offers the first application of a unified growth framework for the quantitative analysis of cross-country comparative development patterns.…”