Contraceptive pricing and prevalence: family planning self-sufficiency in Indonesia

Imposing or increasing user fees can move family planning programs toward self-sufficiency. But, economic theory predicts that quantities demanded decrease following price increases; and, that the size of the response depends, all else constant, upon the share of income accounted for by spending on the good or service. This article uses survey data collected in conjunction with an Indonesian self-sufficiency program to assess the differential magnitudes of contraceptive usage responses to price differentials between sample-wide and relatively poor households, and for both subsidized and full private-sector prices. We find a much more substantial response among poor households. As prices move up toward full cost-recovery, the effect is magnified.