Do Sector Wide Approaches for health aid delivery lead to 'donor-flight'? A comparison of 46 low-income countries

Abstract

Sector Wide Approaches (SWAp) emerged during the 1990s as a new policy mechanism for aid delivery. Eschewing many features of traditional project-based aid, SWAps give greater control of aid allocation to recipient countries. Some critics have questioned whether reducing a donor's level of influence over aid allocation might lead to a decrease in donor contributions. While some qualitative evaluations have described the level of fund pooling and donor participation in SWAps, no previous study has empirically examined this potential 'donor-flight' response to health SWAp implementation. This paper utilises a uniquely compiled dataset of 46 low-income countries over 1990-2009 and a variety of panel data regression models to estimate the impact of health SWAp implementation on levels of health aid. Results suggest that amongst 16 especially poor low-income countries, SWAp implementation is associated with significant decreases in health aid levels compared with non-implementers. This suggests donors are not indifferent to how their contributions are allocated by recipients, and that low-income countries considering a SWAp may need to weigh the benefits of greater control of aid allocations against the possibility of reduced aid income.

Keywords: Aid coordination; Aid harmonisation; Developing countries; Development assistance for health; Health financing; Official development assistance; Sector Wide Approach.