Effect of human capital devolution process on the technical efficiency of public health facilities in Nakuru and Baringo Counties of Kenya

Abstract

This study investigates how the process of human capital devolution affects the technical efficiency of public health facilities in Nakuru and Baringo Counties in Kenya. Despite the expectation that increased government expenditure would enhance efficiency, the public health sector in Kenya continues to need more efficiency. The study was guided by the Human Capital Theory. The human capital devolution process was measured by academic and professional qualification, training and conferences, research and publications, and expenditure on salaries and allowances. This study drew from the Cobb-Douglas production function theory. Employing a quantitative descriptive research design, the study targeted 3199 employees across 401 level 2-5 public health facilities, with a focused sample of 355 proportionately selected employees. Primary data was gathered using structured questionnaires coded and analysed using STATA/SPSS software. Technical efficiency was assessed using two-stage Data Envelopment Analysis (DEA) and multivariate logistic regression. The regression analysis results revealed a significant relationship between human capital and technical efficiency, with a coefficient of human capital development at 0.331 (T-value= 4.384, p-value= 0.000< 0.05 significant level). This indicates a positive impact of human capital devolution on technical efficiency, where a unit increase in human capital development leads to a 0.331 increase in technical efficiency. The study recommends that financial challenges, the unequal distribution of national resources, and poor funding of devolution services can be solved by transferring all functions earmarked to County Governments as per Schedule IV in the Constitution of Kenya, 2010.