Health expenditures, health outcomes and the role of good governance

  • Marwa Farag
  • A. K. Nandakumar
  • Stanley Wallack
  • Dominic Hodgkin
  • Gary Gaumer
  • Can Erbil


This paper examines the relationship between country health spending and selected health outcomes (infant mortality and child mortality), using data from 133 low and middle-income countries for the years 1995, 2000, 2005, and 2006. Health spending has a significant effect on reducing infant and under-5 child mortality with an elasticity of 0.13 to 0.33 for infant mortality and 0.15 to 0.38 for under-5 child mortality in models estimated using fixed effects methods (depending on models employed). Government health spending also has a significant effect on reducing infant and child mortality and the size of the coefficient depends on the level of good governance achieved by the country, indicating that good governance increases the effectiveness of health spending. This paper contributes to the new evidence pointing to the importance of investing in health care services and the importance of governance in improving health outcomes.


Health expenditures Health outcomes Child mortality Infant mortality Governance Developing countries 

JEL Classification

H51 I12 


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Copyright information

© Springer Science+Business Media New York 2012

Authors and Affiliations

  • Marwa Farag
    • 1
  • A. K. Nandakumar
    • 2
  • Stanley Wallack
    • 2
  • Dominic Hodgkin
    • 2
  • Gary Gaumer
    • 3
  • Can Erbil
    • 4
  1. 1.School of Public HealthUniversity of SaskatchewanSaskatoonCanada
  2. 2.The Heller School for Social Policy and ManagementBrandeis UniversityWalthamUSA
  3. 3.Simmons UniversityBostonUSA
  4. 4.International Business SchoolBrandeis UniversityWalthamUSA

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