The effects of health aid on child health promotion in developing countries: cross-country evidence

Abstract

Although epidemiological knowledge in relation to child health has improved in the last few decades, around 3 million children die each year in developing countries from preventable diseases. The international development community views increased immunization coverage for children as an important step in eliminating or reducing these deaths. Many developing countries have very limited resources to tackle major health problems and have to rely on external finance. This article examines the impact of foreign aid devoted to the health sector on child health promotion in developing countries. Two proxies for child health promotion are used: (a) immunization against measles and (b) immunization against Diphtheria–Pertussis–Tetanus (DPT). A range of model specifications and panel data econometric techniques are applied to data covering the period 1990 to 2005. This article finds a positive and statistically significant link between health aid and the measures of child health promotion.

Keywords:

• foreign aid
• child health
• immunization
• developing countries

JEL Classification::

• F35
• I12
• C23

Acknowledgements

The authors are grateful to the editor and anonymous referees for helpful comments and advice.

Notes

¹ MDG 4 focuses on child survival and the target is to reduce by two-thirds under five mortality rates by the year 2015.

² See, for example, Burnside and Dollar (2000), Hansen and Tarp (2000, 2001), Easterly et al. (2004), Rajan and Subramanian (2005) and Ouattara and Strobl (2008). See McGillivray et al. (2006) for a review of this literature and Roodman (2004) for a critique. Islam (1992), Mbaku (1993) and Gounder (2001) are examples of studies using time-series data for individual countries.

³ Masud and Yontcheva (2005) and Mishra and Newhouse (2007) are two other recent studies to examine the impact of aid on health outcomes in general. Ideally, aid devoted to child health would be used although accurate and reliable data at this level do not exist.

⁴ Recent estimates show that more than 95% of measles deaths occur in low-income countries.

⁵ It is estimated that up to 26% of diarrheal-associated deaths can be prevented by measles vaccination (Feachem and Koblinsky, 1983). Pneumonia, malnutrition and shigella dysentery are other complications associated with measles.

⁶ While in industrialized countries immunization coverage are over 80%, in the poorest countries they are less than 50% (WHO, 2003).

⁷ Both the GMM-SYS and the 2SLS techniques use internal instruments (Blundell and Bond, 1998; Baum et al., 2007 for a detailed discussion). Results from all GMM specifications pass the Hansen test for over-identifying restrictions and the Arellano–Bond (1991) test for second-order autocorrelation.

⁸ The authors are grateful to an anonymous referee for making this point.

⁹ Naghipour et al. (2008) estimate that the burden of rotavirus disease causes more than 110 million diarrhea episodes, 25 million clinical visits, 2 million hospitalization and more than half a million deaths, with almost 90% of these cases in developing countries. The authors argue that there is desperate need to extend rotavirus vaccines to developing countries in order to reduce rotavirus-associated deaths.