The Fallacy of the Equity-Efficiency Trade Off: Rethinking the Efficient Health System

The study concludes that the notion of an equity-efficiency trade off has misdirected thinking. Efficiency is about the functional relationship between useful work or sought outputs of a system or process and the level of inputs. By juxtaposing equity and efficiency in the way it is traditionally done in the literature, we presuppose that the real sought output of the system is (a) known and agreed, and (b) not equity. This leads to a paradox, because either we will fail to achieve the greatest quantum of the outputs that we really seek by diverting attention to unsought outputs in the domain of equity, or equity is a part of the outputs that we really seek, in which case there is no trade off. By focusing attention on the true trade off, between the different sought outputs (such as health gains and health equity) then a rational discussion can develop around the appropriate balance between the sought outputs of a health system, and the most efficient way of achieving those outputs.

(Source: TechNet21)