Institutionalising Inequality: The Political Economy of Segmented Healthcare Reform in the Global South

Why do some governments in the Global South expand healthcare in ways that reduce inequalities, while others reinforce existing socio-economic divides? As universal health coverage remains at the centre of the international development agenda, countries have adopted strikingly different reform trajectories – some building unified public systems that promote equity, while others entrench segmentation by expanding access in unequal and stratified ways. This paper examines the political drivers of these divergent paths and the implications for the institutionalisation of inequality through healthcare expansion.
I develop a political economy framework to explain when governments adopt universal versus segmented healthcare reforms, theorising two key political determinants and their interaction with vested interests: government ideology and electoral volatility. Drawing on theories of welfare politics in the Global South, I argue that universal reforms, which equalise access and reduce structural inequality, are more likely when left-wing governments align with newly enfranchised constituencies, and when electoral volatility weakens clientelist strategies, increasing the appeal of broad-based, visible policy expansion. In contrast, segmented reforms – those that expand access while maintaining unequal hierarchies in provision – are often shaped by market-oriented government ideology and the resistance of vested interests such as private providers and labour unions, which seek to preserve existing privileges.
Empirically, I introduce an original dataset of healthcare reforms across 90 countries in the Global South from 1990 to 2023, classifying reforms by their implications for equity in healthcare provision. Using event history analysis, I show that left-wing governments and high electoral volatility are strong predictors of universal reforms, while segmented reforms are more likely under right-wing governments and in contexts of entrenched healthcare privatisation and organised labour. The paper furthermore highlights how partisanship mediates the influence of vested interests, with left-wing governments becoming in favour of segmented expansion in the presence of strong labour unions, and right-wing governments being more responsive to private sector interests.
The paper makes three core contributions to inequality research: (1) it conceptualises segmentation as a form of institutionalised inequality in welfare systems; (2) it introduces a new global dataset to trace the equity implications of healthcare reform; and (3) it theorises how electoral and interest-based dynamics shape the distributive design of health systems. In doing so, the paper challenges technocratic accounts of reform and positions healthcare as a key policy arena in the struggle over social and economic inequality in the Global South.