Economic Consequences of Maternal Illness in Rural Bangladesh

We use panel data on household consumption combined with information taken from the medical records of women who gave birth in health facilities to explore the economic consequences of maternal ill health, in the context of a rural population in Bangladesh. The findings suggest that there is a large reduction in household resources associated with maternal illness, driven almost entirely by spending on health care. In spite of this loss of resources, we find that households are able to fully insure consumption against maternal ill health, although confidence intervals are unable to rule out a small effect. Households in our study area are shown to have good access to informal credit (whether it be from local money lenders or family relatives), and this appears critical in helping to smooth consumption in response to these health shocks, at least in the short term.