ADDIS ABABA UNIVERSITY COLLEGE OF BUSINESS AND ECONOMICS DEPARTMENT OF ECONOMICS Socio-economic Burden of Malaria: The case of Jabi-tehnan District By: Mihret Getaneh Advisor: Atnafu G/Meskel (Ph.D) June 2020 Addis Ababa, Ethiopia ADDIS ABABA UNIVERSITY COLLEGE OF BUSINESS AND ECONOMICS DEPARTMENT OF ECONOMICS Socio-economic Burden of Malaria: The case of Jabi-tehnan District By: Mihret Getaneh A thesis submitted to the college of business and economics of Addis Ababa University in partial fulfillment for the Degree of Masters of Science in Economics (Economic Policy Analysis) June 2020 Addis Ababa, Ethiopia Addis Ababa University College of Business and Economics This is to certify that the thesis prepared by Mihret Getaneh, entitled: Economic Burden of Malaria: The case of Northwestern Ethiopia, and submitted in partial fulfillment of the requirements for the Degree of Master of Science in Economics (Economic Policy Analysis) complies with the regulations of the University and meets the accepted standards concerning originality and quality. Signed by the Examining Committee: Eternal Examiner ________________________Signature____________Date________________ Internal Examiner ______________________ Signature_____________Date________________ Advisor _________________________Signature____________Date__________________ Acknowledgments I would like to give my gratitude to the commitment of my advisor Dr. Atnafu G/Meskel of Addis Ababa University for his supervision throughout my stay at the university. I would also like to acknowledge the technical support I received from Dr. Zewdu Abro, of the International Centre of Insect Physiology and Ecology (icipe). Dr. Zewdu has supported in the development of the research questions, data cleaning, and selection of the econometric models. He has supported me on the Stata software, reference manager software, and provided me journal articles I was not able to access and provided me learning materials and links of course offering in evaluation of social programs. I wrote this thesis attached to the Social Science and Impact Assessment Unit of the icipe as Graduate Research Intern under the Dissertation Research Internship Program (DRIP). My research work is supported by Combating Arthropod Pests for Better Health, Food, and Resilience to Climate Change project (CAP-Africa) implemented by icipe. I also would like to extend my appreciation to the African Economic Research Consortium (AERC) for its financial support to pursue my MSc. I would like to thank my parents and siblings for being there for me every step of the way throughout my work. I’m am also very grateful for my classmates and friends, for their constructive feedback and support every time I needed it. And finally, I would like to thank God for making all this possible. Because God is the only reason, I made it this far. i Acronyms G2SLS - Generalized Two-Stage Least Squares 2SLS - Two-Stage Least Squares 3SLS - Three-Stage Least Squares ACT - Artemisinin Based Combination Therapy API - Annual Parasite Index ATSB - Attractive Toxic Sugar Bait CAP-Africa - Combating Arthropod Pests for Better Health, Food and Resilience to Climate Change CAPI - Computer-Assisted Personal Interviewing CLRM - Classical Linear Regression Model CSA - Central Statistical Agency DALY - Disability Adjusted Life Years lost ETB - Ethiopian Birr FAW - Fall armyworm GDP - Gross Domestic Product GFATM - Global Fund to Fight AIDS, Tuberculosis, and Malaria HI - House improvement HR - High Risk ICIPE - International Centre of Insect Physiology and Ecology IPTp - Intermittent preventive treatment of malaria for pregnant women IRS - Indoor Residual Spraying ii ITNS - Insecticide Treated bed nets IVs - Instrumental Variables KALRO - Kenya Agricultural and Livestock Research Organization KAP - Knowledge, Attitude, and Practice LLINs - Long-Lasting Insecticide Nets LSM - Larval source management MDGs - Millennium Development Goals MR - Moderate Risk NARO - National Agricultural Research Organization OLS - Ordinary Least Squares RBM - Roll Back Malaria Partnership RDT - Rapid Diagnosis Test RE - Random Effects SB - Stemborer SES - Socio-Economic Status SNNP - Southern Nation Nationalities and People TB - Tuberculosis USD - United States’ Dollar VCM - Vector Control Management VIF - Variance Inflation Factor WHO - World Health Organization WTP - Willingness to Pay iii Table of Contents Acknowledgments............................................................................................................................ i Acronyms ........................................................................................................................................ ii List of tables ................................................................................................................................... vi List of Figures ................................................................................................................................ vi CHAPTER ONE: INTRODUCTION ............................................................................................. 1 1.1 Background of the study .................................................................................................. 1 1.2 Statement of the Problem ...................................................................................................... 3 1.3 Hypothesis of the study ......................................................................................................... 5 1.4 Objective of the study ........................................................................................................... 6 1.4.1 General Objective ........................................................................................................... 6 1.4.2 Specific Objectives ......................................................................................................... 6 1.5 Methodology of the study ..................................................................................................... 6 1.5.1 Data type and Source ...................................................................................................... 6 1.5.2. Method of Estimation .................................................................................................... 6 1.6 Significance of the study ....................................................................................................... 6 1.7 Limitation of the study .......................................................................................................... 7 1.8. Organization of the study ..................................................................................................... 7 CHAPTER TWO: REVIEW OF THEORETICAL AND EMPIRICAL LITERATURE .............. 8 2.1 Diseases and Economic System ............................................................................................ 8 2.2 Global Economic Burden of Malaria .................................................................................... 9 2.3 Theoretical foundation on the link between malaria and development outcomes .............. 11 2.3.1 The link between malaria and education outcomes ...................................................... 11 2.3.2 The link between malaria and farm productivity.......................................................... 13 2.3.3 Malaria Control Methods .............................................................................................. 14 2.3.4 Health-seeking behavior of the households .................................................................. 15 2.4 Empirical evidence on malaria ............................................................................................ 16 2.4.1 Empirical evidence on the impact of malaria on education outcomes ......................... 16 2.4.2 Empirical evidence on the health-seeking behavior of households .............................. 17 2.4.3 Socio-economic factors associated with malaria .......................................................... 18 2.5 Evaluation of the Theoretical and Empirical Evidence in the Ethiopian Context .............. 21 2.6 Approach and Contribution of this study ............................................................................ 22 2.7 Conceptual Framework ....................................................................................................... 22 iv CHAPTER THREE: MODELLING ECONOMIC BURDEN OF MALARIA AND ESTIMATION STRATEGY ........................................................................................................ 25 3.1 Data Source ......................................................................................................................... 25 3.2 Study Area ........................................................................................................................... 25 3.3 Description of the Data ....................................................................................................... 27 3.4 Empirical model .................................................................................................................. 28 CHAPTER FOUR: DESCRIPTIVE STATISTICS AND ESTIMATION RESULTS ................ 34 4.1 Socio-demographic characteristics of households .............................................................. 35 4.2 Knowledge of households regarding malaria and its prevention methods.......................... 37 4.3 Practices of individuals regarding malaria prevention methods ........................................