A basic principle of consumer behaviour drawn from microeconomics is that individuals should allocate resources across items of consumption to equalize the marginal utility derived per rupee spent.
The same principle can be applied to optimizing public health expenditure as well; we should aim to equalize the public good derived from the last rupee spent across disease types.
When there is greater ‘bang per buck’ for Disease A as compared to Disease B, resources should be moved away from B to A. Of course, evaluating public good derived from a certain outlay is not easy.
But the principle gives us a valuable framework of thought to assess if public finances are being managed efficiently. While it is true that India has made significant