Estimating the welfare gains from anti-retroviral therapy in Sub-Saharan Africa

Abstract

Since the start of the century, many countries in Sub-Saharan Africa have experienced large gains in life expectancy and average consumption levels. Around the same time, an unprecedented international effort has taken place to combat HIV/AIDS mortality with the expansion of anti-retroviral therapy (ART) across many of the hardest hit countries. In this paper, I estimate the impact of ART on average welfare over time in 42 countries using the equivalent consumption approach. I decompose the change in welfare to isolate the relative contribution of ART-driven improvements in life expectancy and consumption. The results indicate that ART has accounted for around 12% of total welfare growth in SSA between 2000 and 2017. In those countries most affected by HIV/AIDS, this figure rises to around 40%. Moreover, the estimates suggest that welfare in some of the worst-hit countries would have declined over time without the ART expansion.