Intersecting Determinant of Child Mortality: The Role of Health Financing and Government Effectiveness in Developing Countries

Abstract

Ensuring sustainable development in health indicators remains a persistent challenge for developing countries, this is mostly because they don’t have enough resources and insufficient health infrastructure. Several countries have depended on foreign financing to tackle their health issues. In this context, health aid serves as a significant tool in helping developing nations to reduce health issues and improve child survival rates. This study examines the effect of health aid and Domestic Government Health Expenditure (DGHE), Financial Development Index (FD), and Government effectiveness (GE) on the Under-5 Mortality Rate (U5MR) across 99 developing countries from 2002 to 2023. The study utilises panel data and employs robust econometric techniques, including Driscoll-Kraay estimators and the Generalised Method of Moments (GMM). The findings reveal that both health aid and DGHE are negatively related to U5MR, suggesting both play a role in reducing child mortality. However, the effect of health aid is modest, whereas FD and GE are observed to have a positive impact on U5MR. Moreover, the interaction effect of health aid and DGHE is found to increase the U5MR. This study highlights the importance of optimizing resources allocation, applying multisectoral approaches, and enhancing domestic health budget commitment to accelerate progress towards the Sustainable Development Goals (SDGs) 3.2 target.