Subsidies delivering

In this chapter 1 examine and compare three proposals recently made to stimulate private involvement in developing pharmaceuticals for neglected diseases (1) Kremer and Glennerster (2004) and the Center for Global Development (2005) have described in detail a plan for Advanced Purchase Commitments for vaccines, which would commit a global body to pay a fixed subsidy per vaccine delivered for certain diseases, if the vaccine meets prespecified technical requirements and is priced below some level. This would help to solve both access and incentive problems, but is necessarily... 

This is then equivalent to partial grandfathering, and the various arguments discussed in Section 2 are applicable. If such subsidies are justified in some manner, there would be better ways of delivering them than by distorting the auction design. 

Health vouchers are a specific type of demand-side subsidy. They have certain advantages over other types of demand-side subsidies, but they often entail higher transactions costs. In deciding whether to use a voucher scheme to deliver subsidies, policymakers must determine whether the ability to deliver subsidies more efficiently or effectively outweighs the additional administrative costs. They must also consider some of the limitations of vouchers. 

The purpose of the feasibility assessment is to determine whether it is possible to structure the delivery of the proposed subsidies in the form of a voucher scheme. Feasibility assessment also involves making a judgment as to whether doing so is likely to have significant advantages over alternative ways of delivering the subsidies. It may also be necessary to conduct ad hoc studies or pilot tests to determine whether a voucher scheme is feasible and desirable. 

Competitive vouchers are one of many types of an output-based aid approach to health care, which links public funding to delivery of basic services. A Guide to Competitive Vouchers in Health presents tools that can help determine the appropriateness of competitive vouchers to meet different policy objectives. The book explains potential advantages and disadvantages of this approach and discusses ways to deliver public health care subsidies that promote efficiency, innovation, and accountability. 

The World Development Report 2004 reviews traditional approaches to public service delivery and discusses how they have often failed the poor. Whether in health, education, or infrastructure, supply-side subsidy strategies to fund inputs—such as staff costs, equipment, and buildings used in delivery—have not improved the access to quality services among the poor. An important question remains for developing countries and the international development community on how to deliver and target public subsidies in ways that promote efficiency and innovation, increase accountability for performance, and leverage public resources with private participation and financing. 

The output-based aid (OBA) approach seeks to partially answer this question by using a demand-side subsidy delivery strategy. An OBA scheme contracts a private party to deliver services and makes disburse-... 

This guide identifies the advantages of competitive voucher schemes in delivering subsidies describes the circumstances under which they are superior to other subsidy mechanisms and explains how to design, implement, monitor, and evaluate a voucher scheme. It provides a broad outline of the problems faced by health systems, the rationale for government intervention, and the different ways in which governments and donors subsidize health care. 

A similar argument applies in relation to other agri-environmental measures that might incorporate a financial advantage to organic farming in order to reflect its actual environmental benefits. While such benefits are very difficult to quantify in monetary terms, it is obvious that they go far beyond those delivered by integrated approaches, and this should be reflected in the subsidies paid. 

Health clinics and schools are used to deliver food subsidies and supplements to women and children to improve their health, educational achievement, and/or school attendance. Thus participating clinics and schools have to be equipped with adequate storage and cooking facilities to handle the additional requirements of managing the food. 

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