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raise the health standards of the entire society. The cure of individuals suffering from communicable diseases is also a public good because it prevents the spread of the diseases. W. Arthur Levis meets my approval when he says: "Public health measures bring very large reduction in ill health at relatively low cost, especially improvements in the water supply and measures for the control of smallpox, malaria and yellow fever. Output per head may be expected to rise significantly through such measures alone." Given this clear productivity effect of public health, it would be much better to study the subject separately without subsuming it under social security as a whole.2
Family allowances or,
more correctly, children's allowances should have favourable effect on the quality of the labour force, except for the lag of time required for children to grow up before they join the labour force. To some extent, children's allowances overcome some of the debilitating handicaps brought on the children by being born into the wrong families (poor, discriminated, minority, etc.) through no fault of their own. Strengthening the hands of the children relative to their parents', children's allowances ensure certain material standards of life at which children grow up, are educated and socialised. This may also encourage good behaviour on the part of the parents leading to good work habits and good citizenship. To this extent, therefore, children's allowances may also have direct, favourable effect on the quality of the present labour force. On the other hand, by making the raising cf children less expensive, children's allowances may encourage some parents to have more children, inducing an increase in the labour supply with a certain time lag. The net effect on per capita income therefore aust be judged not only by the improvement in labour quality but by the deacgraphic consequences of children's allowances. But children's allowances are usually added to the social security system at a relatively developed stage of the economy, so that their effect on economic growth in developing countries is not ascertained in good enough detail for generalisations.
...
The foregoing discussion makes it painfully obvious that one who wishes to relate social security to productivity must do so on a disaggregated basis and that it is rather futile to try to derive the effect of "social security" as a whole on productivity and economic growth. A remark by Benjamin Higgins is quite appropriate here. "There is no very clear relationship between the degree of social security and either individual income or national income, and there is in the social security field nothing equivalent to the direct relationship between production targets and skill requirements that underlies the manpower approach to educational planning. If protection against the insecurity of unemployment, ill health and old age makes people Work harder and better, they [returns to investment in social security] are positive but if such protection makes people less concerned with providing fcr themselves, SO that they work less hard or less well, they are negative. It is likely that the reactions will differ from one culture to another, and a country may have to do its own research to be sure."3 Failing to find an economic justification for social security, Higgins merely postulates that there must be "social demand for social security" and pursues the subject no farther. Higgins's impasse is of course ä product of conventional growth economics. Even conventional micro-economics, as demonstrated in a previous section, could have helped Higgins analytically obtain "social demand" for economic security which wholly or in part translates into social security through the intermediary of political processes.
V. Income distribution and social security
a
Hopes have often been expressed about the role of social security for promoting a higher degree of equality in income distribution through a redistribution of income from "haves" to "have-nots". However, these hopes have been repeatedly frustrated. The standard social security technology and the philosophical possibility for a broader reinterpretation
of social security with
1 Lewis, "Development Economics
... • P. 23.
2 For an illuminating discussion of this point, see Brian Abel-Smith, "Health policies and investments, and economic development", in The Role of Social Security Chapter 12. See also, G. Myrdal, Asian Drama (New York: Random House, 1968), Vol. III, pp. 1553-1619.
3 Benjamin Higgins, "Planning allocations for social development", International Social Development Review, No. 3 (1971), p. 52.
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