Efficiency in expenditure on healthcare system at state level in India

Efficiency of public expenditure has attained utmost importance in current years, particularly in social sectors like health and education. Since higher expenditure on such sectors is expected to result in better outcomes. The present paper aims to measure the efficiency of expenditure of health care system at the state level in India using Stochastic Frontier Model. The time period considered for the analysis is from 2000–01 to 2016–17 for 17 major states. The results from inefficiency model indicate that inefficiency came down during the study period and99 per cent variations in the performance are due to the technical inefficiency. Highest mean efficiency is obtained by Jharkhand with efficiency score of 83 per cent. It was followed by Orrisa, Tamil Nadu, Uttrakhand. Beside it states like Madhya Pradesh, Haryana, Punjab, Uttar Pradesh and Rajasthan were among the poorer performing states.