1. Semester: III/IV
2. Number of credits: 4

Preamble
This elective course covers theoretical foundations of economics of health and education and also techniques of economic evaluation will be covered for both the sectors. These two aspects of social infrastructure are clubbed together because there is an interdependence of output and existence of large externalities in both health and education sectors. Also these are important components having critical linkages to human development through improving human capabilities and empowerment. This course aims to equip students with skills to understand and analyze the development of health and education sectors. The emphasis will be on policy options and issues for developing countries like India but will also draw on the experience of other countries wherever relevant.

Module 1: Economics of Health (12 Lectures)
Distinction between health and health care- Nature of health care as an economic commodity- Demand for health and Supply of health- Opportunity costs and problems of rationing health care. Costs and efficiency- Costs: fixed, marginal and average costs. Efficiency - technical and allocative efficiency, and of various types of equity. Market System and health care needs- Market failure and the role of government – how insurance markets work, and how they can fail for health care.

Module 2: Financing health care, delivery of health care (12 Lectures)
The economics of financing health care and different approaches taken by governments in different countries-Options for financing health care in developing countries- The rationale of government funding and regulation of health care- examining the potential role of user charges and community financing schemes. Delivery of health care -decentralization and the role of the private/public mix.-health system reforms. The future of Health Sector reforms in developing countries like India.

Module 3: Economics of Education (12 Lectures)
Formal and non-formal education-Special characteristics of education- Implications for economic analysis- Role of the state – Education, Productivity and Employment-Investment in education: Costs and benefits, Private and social rates of return (Human capital and Signaling theories of education).

Module 4: Indian Education System (12 hours)
Indian Education system –Rationale of government funding and regulation of education- Alternative method of financing education-  Resource allocation  to primary, secondary and higher education- Efficiency, equity and distributional aspects: Implications for gender and social groups- Role of private and public sectors, Union and State governments- Special programmes for education.