Resource allocation and time preference in the district health care planning of developing countries

The inter-temporal allocation of scarce resources to different providers of services is influenced by the time preference of decision makers. This paper develops a model of non-linear programming in order to allocate the district health care budget to the different levels of curative and preventive care. It becomes obvious that a high time preference fosters curative services, whereas a strong future-orientation prefers prevention. Thus, the optimal allocation of health care resources requires a detailed analysis of time preference rates. It is questionable whether this fact has been sufficiently considered by development aid as well as by Germany health policy.