Appendix 1: Descriptions of Indicators Dimension 1: Maximizing Efficiency
ME1. Share of allocation to poor countries Generally, poorer countries spend least on health per capita, yet higher spending levels are closely connected with health improvements worldwide. A study in the United States finds that mortality fell by between 1.1 and 6.9% for every 10% increase in public spending (Mays and Smith 2011), while a cross-country study in developing countries found that increased health expenditures are associated with better outcomes in Africa, especially on infant and child mortality (Anyanwu and Erhijakpor 2007). Similarly, a WHO review (2002) found a positive relationship between health-adjusted life expectancy and health spending (Pouillier et al 2002). This literature –while far from definitive- suggests that countries with less capacity to spend on health should receive more health aid. By including the indicator “share of donor allocation to poor countries”, we reward donors that direct more of their resources to poorer countries, thus creating the conditions for “better bang-for-the-buck” for health aid. We use per capita national income as a measure of poverty instead of per capita public spending on health, since we believe that per capita income is a more objective measure of the funding and administrative capacity of countries given concerns that health aid might be fungible. In addition, GDP per capita and public spending on health are highly correlated, essentially measuring the same thing. As in QuODA (2010), we took the logarithm of per capita GDP adjusted for purchasing power parity (CGDP) to emphasize changes at the lower end of the spectrum. We weigh net CPA with the logarithm of CGDP. Hence, we measure the true orientation of donors with respect to need. The donors that allocate most consistently with income per capita are Belgium, Ireland, AfDF, Norway and GAVI. The countries that fare worst in this category are France, Portugal, Korea, IDB and Spain. Allocation rules and eligibility requirements play a clear role in donor performance on this measure. For example, only countries with per capita incomes below US$1,500 per year are eligible for GAVI assistance. Similarly, the IDB –as a demandbased lending institution, limited to funding in Latin America and the Caribbean- will be unlikely to preferentially allocate to the globally worst-off.
netCPAd ,r
Analysis based on:
netCPA r
d
* log CGDP
Source: OECD CRS Database (2009); IMF World Economic Outlook (2011)
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