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Health Aid and Governance in Developing Countries

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  • David Fielding

    (Department of Economics, University of Otago)

Abstract

Despite anecdotal evidence that the quality of governance in recipient countries affects the allocation of international health aid, there is no quantitative evidence on the magnitude of this effect, or on which dimensions of governance influence donor decisions. We measure health aid flows over 2001-2005 for 87 aid recipients, matching aid data with measures of different dimensions of governance and a range of country-specific economic and health characteristics. Both corruption and political rights, but not civil rights, have a significant impact on aid. The sensitivity of aid to corruption might be explained by a perception that poor institutions make health aid inefficient. However, even when we allow for variations in the level of corruption, political rights still have a significant impact on aid allocation. This suggests that health aid is sometimes used as an incentive to reward political reforms, even though (as we find) such aid is not fungibile.

Suggested Citation

  • David Fielding, 2008. "Health Aid and Governance in Developing Countries," Working Papers 0809, University of Otago, Department of Economics, revised Nov 2008.
    • Handle: RePEc:otg:wpaper:0809
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    File URL: http://www.otago.ac.nz/economics/research/otago077113.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    aid; governance; health;
    All these keywords.

    JEL classification:

    • I19 - Health, Education, and Welfare - - Health - - - Other
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations

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