NCPA - National Center for Policy Analysis

Long-run Impacts of a Child Health Investment

September 2, 2015

Good health is key to a productive life and economists have the numbers to prove it. In a recently released study by the National Bureau of Economic Research, researchers examined the impact of childhood health on adult outcomes in low-income economies.

In order to estimate the long-term economic impact of child health investment, the study looks at a community health initiative in Kenya targeting intestinal worm infections in primary school children.

  • According to the World Health Organization (WHO), nearly two billion people worldwide suffer from chronic intestinal worms.
  • Chronic parasitic infections in childhood increase inflammation and cortisol levels, potentially leading to adverse long-term health consequences throughout adulthood.
  • WHO recommends periodic mass school-based deworming initiatives in areas of where infections are most prevalent.
  • Researchers estimate that, in the past, these programs benefitted the community by increasing literacy 17% and have the potential to increase future adult income by 25%.

Researchers were able to demonstrate the positive economic impact of child health investment by measuring the growth of economic opportunity, labor supply, marketable skills and entrepreneurship. Ten years after receiving treatment through a school program, girls were 25% more likely to have attended secondary school. Young men who received anthelmintic treatment spent more time in school, worked 17% more hours each week and were more likely to find higher-skilled jobs.

The study estimates that community health initiatives targeting common childhood ailments had an annualized financial internal rate of return of 32.3%. These gains could have major welfare impacts for households living near subsistence. Ultimately, these results illustrate a critical key in the struggle against endemic poverty: improving the adult labor supply starts with improving childhood health.

Source: Sarah Baird et al., "Worms at Work: Long-run Impacts of a Child Health Investment," National Bureau of Economic Research, July 2015.

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