Government Revenue and Child and Maternal Mortality

Abstract

Most maternal and child deaths result from inadequate access to the critical determinants of health: clean water, sanitation, education and healthcare, which are also among the Sustainable Development Goals. Reasons for poor access include insufficient government revenue for essential public services. In this paper, we predict the reductions in mortality rates — both child and maternal — that could result from increases in government revenue, using panel data from 191 countries and a two-way fixed-effect linear regression model. The relationship between government revenue per capita and mortality rates is highly non-linear, and the best form of non-linearity we have found is a version of an inverse function. This implies that countries with small per-capita government revenues have a better scope for reducing mortality rates. However, as per-capita revenue rises, the possible gains decline rapidly in a non-linear way. We present the results which show the potential decrease in mortality and lives saved for each of the 191 countries if government revenue increases. For example, a 10% increase in per-capita government revenue in Afghanistan in 2002 ($24.49 million) is associated with a reduction in the under-5 mortality rate by 12.35 deaths per 1000 births and 13,094 lives saved. This increase is associated with a decrease in the maternal mortality ratio of 9.3 deaths per 100,000 live births and 99 maternal deaths averted. Increasing government revenue can directly impact mortality, especially in countries with low per- capita government revenues. The results presented in this study could be used for economic, social and governance reporting by multinational companies and for evidence-based policymaking and advocacy.

Government revenue, quality of governance and child and maternal survival

“…Like Filmer and Pritchett, Jamison, Murphy, and Sandbu (2016) and many of the empirical studies analysed by O' Hare et al (2013) use a log formulation in a panel data study to derive comparable elasticities (O'Hare et al 2013;Jamison, Murphy, and Sandbu 2016). Hall et al (2020) also conducted a large panel data study, but they found that the double log specification was outperformed by a model with exponential decay of the effect of government revenue per capita on under-five and maternal mortality (they calculated government revenue per capita by multiplying the government revenue as a percentage of GDP by GDP per capita in constant 2010 USD) (Hall et al 2020). This paper's purpose is twofold: first, we consider an alternative non-linear specification based on survival rates rather than mortality rates.…”

Developing Asia's fiscal landscape and challenges

“…This suggests that most governments seek to achieve a threshold level of defence spending irrespective of development and tax levels, and that defence spending accounts for a disproportionately high share of outlays in many of the lowest-taxed and poorest countries. While correlation does not imply causation, these trends suggest that increased tax revenue will often be directed towards development-promoting areas, a claim strengthened by more detailed empirical evidence on taxes and health spending (Carter andCobham 2016 andHall et al 2021).…”

“…While correlation does not imply causation, these trends suggest that increased tax revenue will often be directed towards development‐promoting areas, a claim strengthened by more detailed empirical evidence on taxes and health spending (Carter and Cobham 2016 and Hall et al 2021).…”

Tax abuse—The potential for the Sustainable Development Goals

“…An increase in revenue has much more impact when the government revenue per capita is small, highlighting that an increase in revenue would have a much more significant effect on low-and lower-middle-income countries. Government revenue also reflects the spending capacity for all sectors, which indirectly affects health, including education and infrastructure [11].…”

“…The best model of this non-linearity is a version of an inverse function that starts with minimal effects for countries with low government revenue per capita; the impact rapidly increases until a saturation point or plateau is reached, and the impact of an increase in revenue on the SDGs slows. Thus countries with small per-capita government revenues have a better scope for progress towards the SDGs with small revenue increases [11]. Rather than impose the same sigmoid shape across all countries, the modelling includes six dimensions of governance from the World Governance Indicators [41], allowing an individual 'sigmoid' 'S' shape, which varies for each country as governance and revenue change.…”