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Equity is the concept or idea of fairness in economics, particularly as to taxation or welfare economics. In welfare economics, equity may be distinguished from economic efficiency in overall evaluation of social welfare. Although 'equity' has broader uses, it may be posed as a counterpart to economic inequality in yielding a "good" distribution of welfare. It has been studied in experimental economics as inequity aversion. In public finance horizontal equity is the idea that people with a similar ability to pay taxes should pay the same or similar amounts. It is related to the concept of tax neutrality or the idea that the tax system should not discriminate between similar things or people, or unduly distort behavior. Vertical equity is the idea that people with a greater ability to pay taxes should pay more. If they pay more strictly in proportion to their income, this is known as a proportional tax; if they pay an increasing proportion, this is termed a progressive tax, more associated with redistribution.
In a Health Care Context
[justify]Horizontal equity means providing equal healthcare to those who are the same in a relevant respect (such as having the same 'need'). Vertical equity means treating differently those who are different in relevant respects (such as having different 'need'), (Culyer, 1995).Health studies of equity seek to identifywhether particular social groups receive systematically different levels ofcare to other groups. They do this by making use of the "equitygauge".
In fair division Equitability In a Health Care Context
[justify]Horizontal equity means providing equal healthcare to those who are the same in a relevant respect (such as having the same 'need'). Vertical equity means treating differently those who are different in relevant respects (such as having different 'need'), (Culyer, 1995).Health studies of equity seek to identifywhether particular social groups receive systematically different levels ofcare to other groups. They do this by making use of the "equitygauge".
in fair division means that every person’s subjective valuation of their own share of some goods is the same. The surplus procedure (SP) achieves a more complex variant called proportional equitability. For more than 2 people a division cannot always both be equitable and envy-free.
What does equity in health mean?
The question of what rules should be used in determining access to health and health care has been hardly addressed in the public debate on the future of the health service. In the UK, as in other countries, the goal of efficiency (production of output using least cost-methods) has dominated official pronouncements. Far from the public view, however, another controversy has raged on the “other objective” of economic policy: equity, which implies that economic and social goods should be distributed fairly across individuals. Curiously, this debate has been characterised by an immense production of empirical facts and parallel disregard for the precise specification of equity objectives. However, unless the objectives of the health system are clearly specified, empirical research can do little to reveal the reasons why equity is important, the extent to which specific types of inequality are compatible with equity, how the concept should be measured and how efficient policies to achieve equity goals may be formulated and monitored. To answer these questions it is necessary to specify a normative framework that may guide positive analysis in relation to
policy-specific equity objectives. The paper reviews a wide range of literature by firstly identifying a number of criteria for evaluating the diverse concepts of equity which have appeared in the literature. This is followed by a critical appraisal of six well-established approaches: egality, entitlement, the decent minimum, utilitarianism, Rawlsian maximin and envy-free allocations. All of these distribution rules are found wanting in some respect when applied to the health sector. Given the shortcomings of traditional concepts, health economists have proposed alternative and novel formulations. The two most important contributions to date are Le Grand’s notion of ‘equity as choice’ and the health maximisation account, associated with economists at York University. Though these rules afford important insights into the question of what equity in the health domain entails, they too are problematic. In the final part of the paper, an approach which strangely has been virtually ignored by economists and others who share an interest in the health-equity problem is examined. Sen’s ‘capabilities’ concept, it is argued, comes closer to achieving all the specified assessment criteria than any other formulation previously discussed. As such it could prove an effective framework within which to organise research and policy formation in the area of health and healthcare inequality. All European governments are seeking to reform their health care systems. All too often this process gives little attention to the primary goals of health care policy. Unless these are carefully specified and reforms carefully related to them, it will be impossible to determine whether changes in policy, such as those envisaged in the NHS White Paper, can meet the designated objectives.
Read this also for better understanding;
http://www.york.ac.uk/depts/spsw/staff/documents/WilliamsCookson2000_1.pdf
(By Alan Williams and Richard Cookson)
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