The economics of coordinating health aid: investigating the sector wide approach

This thesis presents an econometric analysis of the Sector-Wide Approach (SWAp) for delivering health aid to lower-income countries. The SWAp was designed to address problems associated with traditional project-based aid delivery. Chief among these problems, project-based aid may lead to fragmented aid, better aligned with donor preferences than recipient priorities. The health SWAp aims to address problems associated with aid fragmentation by improving donor coordination. Further, by increasing recipient country ownership of health aid programmes, the health SWAp should facilitate reallocation of health aid to areas of highest recipient priority. This thesis provides important new insights for health and development policy makers; both in aid recipient countries and amongst donor organisations. The SWAp first appeared in health and education sectors of African and Asian countries in the early 1990s. Despite more than 20 years of experience with health SWAps, the evidence base regarding impact remains weak. Major limitations exist both in terms of the range of impacts investigated as well as the study methodologies utilised. Most notably, evaluations have been limited to the use of case study methodologies to identify SWAp impacts. This approach is unable to control for the number of important global and country specific changes that have occurred over the last 20 years, confounding estimated effects. The analyses presented in this thesis address this major limitation. A uniquely compiled panel dataset of countries receiving development assistance for health (DAH) over the period 1990-2010 is used. Fixed effects and dynamic panel models are employed using contemporaneous control groups to assess SWAp impacts; controlling for time varying determinants of DAH such as health need, wealth, global trends in DAH and governance in DAH receiving countries. This thesis applies rigorous and as yet un-utilised econometric methods to identify important SWAp impacts on DAH funding flows and health outcomes.