_Policy, Planning, and Research Working Paper Series_ 61 on final school levels.

This paper is a product of the Education and Employment Division, Population and Human Resources Department. Please contact Cynthia Cristobal, room S6-001, extension 33640.

# 173. Hospital Management Staffing and Training Issues

Julio Frenk, Enrique Ruelas, and Avedis Donabedian _Hospitals dominate health care, so making hospitals more efficient is crucial to better health care delivery. The authors suggest an agenda for research._ Hospitals dominate health care in most parts of the world and for a variety of reasons are likely to continue being a key factor in the overall performance of the health care system. Any efforts to improve this performance must therefore give greater hospital efficiency the highest priority.

After discussing key issues of managerial, clinical, and production efficiency, Frenk, Ruelas, and Donabedian suggest an agenda for research, which would include two types of research:

* Observational studies that document levels of hospital performance and correlate them with organizational design and environmental variables. It is especially important to devise and test sensitive, specific indicators of managerial, clinical, and service production efficiency.

* Comparative intervention studies that would introduce planned change in hospitals and assess the consequences - using control groups as well as cost-benefit and cost-effectiveness analyses.

The mostly highly recommended subjects for research, in order of priority, are:

* Good descriptive studies of the hospital system and the main aspects of - organization design to chart, for example, the formal and informal relations among managers and clinicians, the frequency of different arrangements for internal communication, types of departmentalization, and management systems.

* The systematic design, testing, and study of explicit quality monitoring and assurance systems. Such studies should include the analysis of interactions between managers and clinicians,

especially as they constrain clinical autonomy and decision making.

_*_ Studies to determine which social, personal, organizational, and educational factors account for managerial skill and success in managing a hospital - to get the information needed for the recruitment and training of successful hospital managers.

* Studies of the structure and dynamics of medical labor markets, to improve understanding of why there is an oversupply of doctors in so many different countries.

This paper is a product of the Health and Nutrition Division, Population and Human Resources Department. Please contact Sonia Ainsworth, room S6-065, extension 31091 (37 pages with charts).

## 174. Trade Restrictions with Imported Intermediate Inputs: When Does **the Trade Balance** Improve?

Ram6n L6pez and Dani Rodrik _When imports are predominantly inter- mediate inputs as they are in most - developing countries import restrictions act as a supply shock to the economy andthereforecannotalwaysbereliedonto improve the trade balance._ The author's model demonstrates that when imports are predominantly inter- mediate inputs as they are in most - developing countries import restrictions cannot always be relied upon to improve the trade balance. Such restrictions act as a supply shock to the economy.

Unless nontraded goods are intensive users of imported intermediates, the general-equilibrium consequence of import restrictions is a large enough reduction in export supplies to swamp the directeffectoftherestrictions. Theresultis a deterioration in the trade balance.

One can check the robustness of the author's model results with extensions that may capture more realistic features. One extension is to consider real wage rigidity and unemployment. If capital in the short run is sector-specific, the net effect of a small tariff remains ambiguous - because an increase in the domestic price of imported inputs will cause a fall in employment and thus a decrease in real income.

Another extension is to consider domestic production of the imported intermediate goods. Such production is likely to be an important factor in medium- and high-income countries, but much less so in very poor countries. The income effect of the tariff will still be negative, though less so.

This paper is a product of the Trade Policy Division, Country Economics Department. Please contact Maria Ameal, room N8-069, extension 61466 (15 pages with tables).

## 175. An Integrated **Model** of Perennial **and Annual Crop** Production for Sub-Saharan Countries

### Robert D. Weaver

_This microeconomic model of household choice reflects the fact that crop production in Sub-Saharan Africa is dominated by smallholders who allocate household labor across annual and perennial crops and, in some cases, to wage labor markets._ Crop productioninSub-SaharanAfricais dominated by smallholders who allocate household labor across annual and perennial crops and, in some cases, to wage labor markets.

Weaver has developed a microeconomic model of household choice which is consistent with observed characteristics of Sub-Saharan agricultural systems in terms of:

* Integrated production of annual and perennial crops (since households often produce both annuals and perennials). This interaction has been ignored in past models.

* Price uncertainty in markets that may be affected by government intervention.

* The potential for off-farm employment.

* Household consumption of crops produced on the farm (on-farm inventories are usually nonexistent).

* Household consumption of nonfood goods, school fees, and so on.

Weaver considers variations is the model to establish their implications. These variations include differential buying and selling prices, fixed subsistence consumption constraints, participation in wage market labor, smuggling in response to goverment price control, and parallel markets with penalties for smuggling.