ENDS AND MEANS IN PUBLIC-HEALTH POLICY IN DEVELOPING-COUNTRIES

International discussions of public health policy strategies in develo ping countries have been characterized by strong and conflicting posit ions. Differences regarding the means of health sector improvement can often be traced to differences about the ends, that is, the goals of the health sector. Three types of health sector goals are reviewed: he alth status improvement, equity and poverty alleviation, and individua l welfare (utility) improvement. The paper argues that all three must be considered in developing health sector reform strategies in all cou ntries. Highly normative policy positions often can be attributed a un idimensional affiliation with one health sector goal and denial of the relevance of the others. The current global interest in using cost-ef fectiveness analysis to set national health priorities is assessed in light of this eclectic approach. Examples are provided of how a health sector strategy based on cost-effectiveness would give sub-optimal so lutions. These examples include situations where a private health care sector exists and provides some degree of substitution for publicly p rovided services; significantly high income elasticities exist for hea lth care such that higher income beneficiaries may differentially capt ure public subsidies; and market failures exist in insurance. It is ar gued that these conditions are virtually universal in developing count ries. Thus, rational policy development should explicitly consider mul tiple goals for the health sector.