Assessing the Economic Impact of HIV/AIDS on Nigerian Households: A Propensity Score Matching Approach

David Canning, Ajay Mahal, Kunle Odumosu and Prosper Okonkwo
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Prosper Okonkwo: Harvard School of Public Health

PGDA Working Papers from Program on the Global Demography of Aging

Abstract: We assess the impact of HIV/AIDS on individuals’ health care utilization and spending in the Oyo and Plateau states of Nigeria and income foregone from work time lost. Data was from a 2004 survey of nearly 1,500 households, including 482 individuals living with HIV/AIDS. Estimating the effect of HIV is complicated by the fact that our sample of HIV positive individuals is non-random; there are selection effects, both in acquiring HIV, and in being in our sample our HIV positive people, which was based on contacts through non-governmental organizations. To overcome this selection effect, we compare HIV positive people with a control group with similar observed characteristics, using propensity score matching. The matched control group has very different health and economic outcomes than a random sample of the population indicating that our HIV sample would not have had "average" outcomes even if they had not acquired HIV. HIV is associated with significantly increased morbidity, health care utilization, public health facility use, lost work time and increased time devoted to care-giving relative to outcomes in the control group. Direct health care costs and indirect income loss per HIV positive individual were 16,569 Naira, about 32% of annual income per capita in affected households. About 40% of these costs are income losses associated with sickness and care-giving. 15% of the cost of HIV is accounted for by public subsidies on health. The largest single economic cost, representing 45% of the total economic burden of HIV, are out of pocket expenses, mainly for health care.

Keywords: HIV; Nigeria; Economic Impacts; Households; Direct Costs; Propensity Score (search for similar items in EconPapers)
Date: 2006
New Economics Papers: this item is included in nep-afr, nep-dev and nep-hea
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