Convergence of Health Expenditure in Sub-Saharan Africa: Evidence from a Dynamic Panel

To address the problem of underfunding of health systems in SSA the Abuja Declaration of 2001 set a target to allocate 15% of a country’s budget to public health expenditure. However there is no empirical evidence on whether SSA countries are converging or diverging from the target and whether there is significant effect of the Abuja instrument on other health expenditure indicators. This study tested convergence of health expenditure in SSA in the post Abuja declaration period. The linear dynamic panel model was estimated by GMM-IV method on a panel of 41 SSA countries for the period 2000 to 2011. The empirical results show evidence of absolute and conditional convergence of health expenditure in SSA. Real income per capita, donor funding for health care and benefitting from HIPC debt relief influenced direction and rate of convergence of health expenditure. The Abuja policy instrument (public health expenditure as a percent of government) reduced the rate of convergence of other health expenditure measures except for private health expenditure as percent of total health expenditure which was increasing in the study. The results imply that continued reliance on donor funding for health systems directly or through debt relief is likely to delay convergence to Abuja target. SSA governments can formulate sustainable health financing mechanisms that reduce dependency on external source for health system support in the long run. Keywords: Convergence, Health Expenditure, SSA, Dynamic Pane

Effect of Health Expenditure on Child Health in Sub-Saharan Africa: Governance Perspective

Though child mortality in Sub-Saharan Africa has declined since 2000, they are still higher than other regions of the world. This has provided impetus for increasing effectiveness of health expenditure through improved quality of governance in the health sector. Dynamic panel estimation method was used to estimate panel data for 41 SSA countries for the period 2000 to 2009. The results show that public health expenditure relative to private health expenditure led to fall in under-five mortality rates in SSA. When corruption was controlled for effectiveness of public health expenditure on reducing under-five mortality was evident. Additionally, regional variations in effectiveness of health expenditure on under-five mortality was also realized. SSA countries are likely to benefit from reduced corruption which has an impact on effectiveness of health expenditure on child health outcomes. Keywords: Health Expenditure Child Health SSA Corruptio

HAS QUALITY OF GOVERNANCE AFFECTED THE EFFECTIVENESS OF HEALTH EXPENDITURE ON ADULT HEALTH IN SUBSAHARAN AFRICA?

Compared to the rest of the world Sub-Saharan Africa (SSA) still has a challenge in reducing its adult mortality. Investments in adult health is a prerogative of SSA governments as they provide the source of labour force, human capital endowment and consumption which are benchmarks of economic growth. Though health expenditure has risen in SSA, quality of governance especially level of corruption is not impressive. The corruption levels are of concern because they may have a negative impact on effectiveness of health expenditure in reducing premature adult mortality in SSA. This study examines interaction of health expenditure and corruption and its effect on adult mortality. Regional differences in the relationship between health expenditure, corruption and adult mortality are also determined across the four regions of SSA: Western, Southern, Central and Eastern Africa. This study has used dynamic panel data model to investigate effectiveness of health expenditure on adult mortality under the influence of corruption. The results indicate that corruption influence positively the effectiveness of public health expenditure while that of private health expenditure is negative. Regional variation exists in the effectiveness of both public and private health expenditure on adult mortality

HAS QUALITY OF GOVERNANCE AFFECTED THE EFFECTIVENESS OF HEALTH EXPENDITURE ON ADULT HEALTH IN SUBSAHARAN AFRICA?

Compared to the rest of the world Sub-Saharan Africa (SSA) still has a challenge in reducing its adult mortality. Investments in adult health is a prerogative of SSA governments as they provide the source of labour force, human capital endowment and consumption which are benchmarks of economic growth. Though health expenditure has risen in SSA, quality of governance especially level of corruption is not impressive. The corruption levels are of concern because they may have a negative impact on effectiveness of health expenditure in reducing premature adult mortality in SSA. This study examines interaction of health expenditure and corruption and its effect on adult mortality. Regional differences in the relationship between health expenditure, corruption and adult mortality are also determined across the four regions of SSA: Western, Southern, Central and Eastern Africa. This study has used dynamic panel data model to investigate effectiveness of health expenditure on adult mortality under the influence of corruption. The results indicate that corruption influence positively the effectiveness of public health expenditure while that of private health expenditure is negative. Regional variation exists in the effectiveness of both public and private health expenditure on adult mortality