| Abstract: | This study focuses on the estimation of demand for immunization as well as its technological effect on the survival probability of a child in rural India. Careful attention is paid to the consequences of parental selection on survival technology and demand for health inputs. The results suggest that child mortality is negatively related to the likelihood of purchasing vaccination, but imperfect vaccination substantially reduce the beneficial effect. Results also suggest that a mother who perceives her child faces a risk of higher likelihood of death compensates for their beliefs in a beneficial way. Consequently, estimations that ignore this selection underestimate the impact of immunization on child survival. Mothers also engage in complementary behavior by reinforcing investment when they choose among health inputs. Estimations that ignore the complementarity substantially overstate the impact of prenatal care and delivery care on demand for immunization. The evidence for complementarity among measured inputs also implies that there might be favorable selection between measured and unmeasured inputs, although the adverse selection seems dominant in this study.Useful comments were received from Michael Grossman, John Strauss, Agnes Quisumbing, Robert Retherford, Rakesh Munshi, DoAnne Sanchez, Kathleen Beegle, seminar participants in the Econometric Society meeting and University of Hawaii, and two anonymous referees. I would like to thank Gayle Yamashita and Vicky Ho for their assistance with compiling data. |
