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The importance of efficiency in resource utilization in healthcare sector has been recognized globally. In this paper we focus on efficiency of healthcare system at sub-state level (i.e., district level) in India using Gujarat state and its district level data for 2012-13. In spite of being an economically advanced state, in terms of infant mortality rate (IMR) the state is not the lowest. We explore the reasons for relative performance of different districts with data envelopment analysis (DEA). We used IMR as output variables. Using principal component analysis we tried a sub-set of variables, which had low correlations. Thus, four factor scores relating to medical officer, lady medical officer, Ayurveda, Yoga and Naturopathy, Unani, Siddha and Homoeopathy doctor, pharmacist, were used for DEA. We have focused on Charnes, Cooper, and Rhodes scores (or constant returns to scale technical efficiency score), and discussed efficiency rankings based on these. Thus, our results pertaining to district level health system efficiency in Gujarat State indicate that some of the districts have low efficiency in utilization of inputs like doctors, beds and workload per health institutions. There are also other districts, which need more of these inputs, which may enhance their output and efficiency. Thus, it is suggested that the efficiency in Valsad needs an improvement much more than other districts, whereas districts like Ahmadabad and Surat need more of both medical manpower and facilities. Even in case of Vadodara and Rajkot, the ranking in terms of most of medical manpower and facilities is low and thus these districts may also be benefitted by additional inputs. Hence, there is a mix of both inefficiency and inadequacy of inputs, which is reflected in our results.
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