DETERMINANTS OF DIARRHEAL DISEASE IN JAKARTA

Using data from a Jakarta household survey, we estimate a model of hou sehold defensive behavior and illness allowing for some risk factors t hat are hidden to the analyst but, perhaps, known to the household. As predicted by a general preference-based theoretical model, defensive behavior (washing hands after toilet) intensifies with exposure to con taminants, income, opportunity, and education. Diarrheal disease, in t urn, is determined by these factors and by defensive behavior. We also find evidence, though weak, in support of findings by VanDerslice and Briscoe [1993] that pathogens are less harmful if they originate from within the household. Households are affected by water company decisi ons and management strategies, in particular, the frequency of interru ptions, which interfere with defensive behavior, These findings link t he inadequate supply of water for domestic use, a publicly provided go od, and the private actions of the household, which are driven by its preferences for consumption goods and health, resource constraints, an d knowledge of the sources of contagion. Such findings are therefore i mportant in guiding the intersectoral allocations of public funds as w ell as the balance between private and public budgets.