The Impact of Macro Economic Performance - Foreign Finance and Poverty On Child Well-Being-Dereje's Dissertation For Masters Degree UA-IDPM 2003

University of Antwerp
Institute of Development Policy and Management
Dissertation:
The Impact of Macroeconomic Performance, Foreign Finance and

Poverty on Child Well-being in Developing Countries: Lessons from the
World Summit for Children
Dereje DEJENE ENGDASHET
Masters Degree in Development Evaluation and Management
Promoter: Dr. Nathalie Holvoet
Academic Year 2002 - 2003

Determinants of Child Wellbeing in Developing Countries- Lessons from World Summit for children
TABLE OF CONTENTS
List of Figures.......................................................................................................................................... 1
List of Tables ........................................................................................................................................... 2
List of Acronyms ..................................................................................................................................... 3
Preface ..................................................................................................................................................... 4
I. INTRODUCTION ............................................................................................................................................5
II. HYPOTHESIS AND METHODOLOGICAL APPROACHES ................................................................7
2.1 HYPOTHESIS ............................................................................................................................................. 7
2.2 METHODICAL APPROACHES......................................................................................................................... 7
III. THE STATUS OF CHILDREN IN GLOBAL CONTEXT..................................................................... 10
3.1 CHILDREN IN GLOBAL DEMOGRAPHIC CONTEXT ........................................................................................... 10
3.2 CHILD MORTALITY IN DEVELOPING COUNTRIES DURING THE DECADE ............................................. 12
3.3 CHILD NUTRITION STATUS IN DEVELOPING COUNTRIES DURING THE DECADE: ................................ 13
3.4 CHILD EDUCATION (PRIMARY SCHOOL ENROLMENT) IN DEVELOPING COUNTRIES DURING THE
DECADE: ..................................................................................................................................................... 15
IV. WHAT HAMPERED THE WORLD SUMMIT FOR CHILDREN? .................................................... 20

4.1 REVIEW OF END-DECADE REPORT OF THE UNITED NATIONS SECRETARY-GENERAL AND OTHER UN
AGENCIES. ................................................................................................................................................. 20
4.2 THE THEORETICAL FRAMEWORK ............................................................................................................... 22
4.3 MACROECONOMIC PERFORMANCE AND CHILD WELLBEING ........................................................................... 24
4.3.1 The link between macroeconomic performance and child wellbeing ............................ 24
4.3.2 Economic growth and child wellbeing. ................................................................................ 26
4.3.3 Inflation and its effects on child wellbeing ........................................................................ 35
4.4 GOVERNMENT BUDGET ALLOCATION AND CHILD WELLBEING ........................................................................ 39
4.4.1 The link between government budget and child wellbeing ............................................. 39
4.4.2 Effect of government budget allocation on child wellbeing ........................................... 41
4.5 FOREIGN AID/ FINANCE AND CHILD WELLBEING ............................................................................... 45
4.5.1 Overview of the need and status of foreign aid during the decade ............................... 45
4.5.2 The philosophy and interests behind aid ............................................................................. 47
4.5.3 Foreign aid and private capital flows to developing countries ....................................... 49
4.5.4 Effectiveness of aid in developing countries-review of literatures ............................... 50
4.5.5 How to measure aid/ foreign financial flows ..................................................................... 54
4.5.6 Effect of foreign aid/finance on child wellbeing during the decade ............................. 56
4.6 THE CHALLENGE OF POVERTY AND INEQUALITY ON CHILD WELLBEING ........................................... 67
4.6.1 Understanding Poverty ............................................................................................................ 67
4.6.2 Measuring Poverty ................................................................................................................... 69
4.6.3 The effects of income poverty and inequality on child wellbeing-a review ................ 75
4.6.4 Poverty and inequality Vs. progress in child wellbeing indicators during the decade 76
V. DETERMINING THE DETERMINANTS OF PROGRESS IN CHILD WELLBEING .................... 83
5.1 OVERVIEW OF THE OTHER CONTRIBUTING FACTORS AFFECTING CHILD WELLBEING ........................ 83
5.2 ANALYSIS OF DETERMINANTS ............................................................................................................. 85
5.2.1 Basic assumptions for building the models ......................................................................... 85
5.2.2 Determinants of under 5 child mortality rate reduction ................................................. 86
5.2.3 Determinants of under 5 child malnutrition rate reduction ........................................... 90
5.2.4 Determinants of improvement in primary education enrolment .................................... 92
VI. SUMMARY CONCLUSION ..................................................................................................................... 97
Annex 1: The details of variables by type by sources. ........................................................................ 101
Annex 2. List of Countries included in the study by Region .............................................................. 103
BIBLIOGRAPHY ............................................................................................................................................. 104
Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. Sptember, 2003

List of Figures
Fig.- 1. Relative population (percent) of children of different age category in the glob and
different groups of countries (by the year 2000) 10
Fig.- 2. Relative population (percent) of children of different age category in different regions
of Developing countries (by the year 2000) 11
Fig.-3 Prevalence of Under 5 Child Malnutrition in Developing Regions of the World (1990
and 2000) 14
Fig.- 4. Net Enrollment Ratio in Primary School in Different Regions of the World: 1990/91
and 2000/01 comparison 16
Fig. -5 Variation in Net Enrollment Ratio-Primary School in Different Regions of
Developing World in the Year 2000/01 17
Fig.-6 Net Enrollment Ratio–Primary Education in the Year 2000/1 in Developing Regions
of the World by Sex. 18
Fig.-7 Schematic framework (Theoretical Construct) of Factors Affecting Child wellbeing in
Developing Countries 21
Fi.-8 Children at the Center: Successive Economic Environments that Affect Child Wellbeing 25
Fig.-9 Scatter plot of Under 5 Mortality rate -Decade reduction (%), 1990-2000 vs. GDP per
capita average annual growth rate (%): (a)1990-2000 and (b) 1960-1990. 28
Fig. -10a Scatter plot of percent of Under 5 Under Weight (1995-2000) vs. GDP per capita
average annual growth rate (%): 1990-2000 30
Fig. -10b Scatter plot of percent of Under 5 Under Weight (1995-2000) vs. GDP per capita
average annual growth rate 1960-90 31
Fig.-11 Scatter plot of Net Enrolment Ratio-Primary-Total (2000) vs. GDP per capita
average annual growth rate (%): (a) 1990-2000 and (b) 1960-90 34
Fig.-12. The Total Net Flow of Long-Term Financial Resources from DAC Countries to
Developing Countries and Multilateral Organizations by Type of Flow in Millions of
US$ (2000 price) 49
Fig.-13. Scatter plot of under -5 child mortality rate by 1990 vs. Aid allocation (as % of
GDP) during the decade 1990-2000 (before after log transformation) 57
Fig.-14. Scatter plot of under -5 child mortality rate by 1990 vs. Per capita Aid allocation
during the decade (1990-2000 ) 59
Fig.-15. Scatter plot of under -5 child mortality rate reduction over the decade -vs. aid (%
GNP) transferred to developing countries during the decade (1990-2000). 64
Fig.-16. Example of Lorenz curve 71
Fig.-17. Scatter plot of decade reduction of under -5 child mortality rate vs. poverty index
and poverty gap during the decade (1990-2000) 78
Fig.-18. Scatter plot of decade reduction of under -5 malnutrition rate vs. poverty index and
poverty gap during the decade (1990-2000) 79
Fig.-19. Scatter plot of progress in total NER –primary education vs. poverty index and
Fig.-20. Scatter plot of progress in female NER –primary education vs. poverty index and
Fig.-21 Scatter plot of total NER at the beginning of the decade (1990/1) Vs. Progress in total
NER-in primary education during the decade. (1990-2000) 95
Fig.-22 Scatter plot of progress in female children NER- in primary education Vs. Private capital
flows into developing countries during the decade. (1990-2000) 96
Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 1

List of Tables
Table-1 Under 5 child mortality rate and its rate of reduction in developing regions of the
World (1960-2000) 12
Table-2 Female-Male Gap in NER in the Developing Regions of World (1990 & 2000) 18
Table-3 Prevalence of Under 5 underweight (1995-2000) among countries with different rate
of GDP per capita growth during the decade(1990-2000) 32
Table-4. Level of Net Enrolment Ratio-Primary-Total (2000) among countries with different
rate of GDP per capita growth rate during the decade (1990-2000) 35
Table-5. Comparison of progress in child wellbeing indicators among countries with different
rates of inflation during the decade (1990-2000) 38
Table-6 Descriptive Statistics of central government expenditures allocation of developing
countries for Health, Education and Defense during the decade (1990-2000) 41
Table-7 Correlation matrix of Child wellbeing indicators vs. central government expenditures
allocation for Health, Education and Defense during the decade (1990-2000) in
developing countries 43
Table-8. Test for equality of Means in child wellbeing indicators among countries with
different level of central government expenditure allocated for Health during the decade
(1990-2000) 44
Table-9. Correlation matrix of under 5 mortality rate (1990 and 2000) vs. total population
and under 5 population in 2000. 60
Table-10 Correlation matrix of progress in child wellbeing indicators vs. aid allocation
during the decade (1990-2000) 63
Table-11 Correlation matrix of progress in child wellbeing Indicators vs. private capital flows
and debt service during the decade (1990-2000.) 66
Table 12 Correlation matrix of status of child wellbeing indicators by the end of 2000 Vs.
poverty and inequality measures during the decade (1990-2000.) 76
Table-13 Ordinary Least Square (OLS) estimators of explanatory variables alongside
U5CMR reduction during the decade (1990-2000.) 88
Table-14 OLS estimators of explanatory variables alongside Reduction of Prevalence of
Under 5 Child Malnutrition during the decade (1990-2000.) 91
Table-15 OLS estimators of explanatory variables alongside Percent of Change in NER-
Primary Education over the decade (1990-2000) 93
Table- 16 Summary matrix: effect of different intervening variable on the progress of child
wellbeing indicators during the decade (1990-2000) 100

List of Acronyms
AAI Aid Allocation Index
ACC/SNC United Nations Administrative Committee on Coordination
the Sub-Committee on Nutrition
CEE/CIS Central and Ester Europe and Country of newly Independent State
CNTS Cross National Time Series- a data base
CPI Consumer Price Index
CRC the Convention on the Rights of the Child
CRIN Child Right Information Network
DAC Development Assistance Committee
EDA Effective Development Assistance
EFA Education for All
GDP Gross Domestic Product
GNP Gross National Product
GQ Grant equivalents of loans
HDI Human Development Index
HPI Human Poverty Index
IEC Information Education and Communication
ILO International Labour Office
IMF International Monetary Fund
LB Live Births
MDGs Millennium Development Goals
NCHS National Center for Health Statistics
NER Net Enrollment Ratio
NGOs Non Governmental Organizations
NPA National Plans of Action
ODA Official Development Assistance
OECD Organization for Economic Cooperation and Development
OED Operation Evaluation Department- of the World Bank
OLS Ordinary Least Square
PPP Purchasing Power party
SSA Sun-Saharan Africa
U5CMR Under 5 Child Mortality Rate
UNAIDS The Joint United Nations Programme on HIV/AIDS
UNDP United Nations Development Program
UNESCO United Nations Educational, Scientific and Cultural Organization
UN-HCHR United Nation High Commissioner for Human Right
UNICEF United Nations Children‟s Fund
UNICEF/ICDC United Nations Children's Fund/ Innocenti Research Centre
USAID United State Agency for International Development
WDI World Development Indicators
WDR World Development Report
WHO World Health Organization
WHO World Health Organization

Preface
There were two options offered by the Institute: to do internship with known agencies and
write internship report or to write Dissertation based on field and/ or desk study as a partial
fulfillment of Masters Degree in Development Evaluation and Management. As I initially
proposed to the institute during my application for admission, I preferred to write
dissertation. My initial proposition to the institute and to my employer, Christina Children‘s
Fund Inc. (CCF), was to work on the impact of Poverty and Poverty Reduction Strategies on
'Holistic Child Development‘. This proposition stemmed from my academic background and
experience (an Agricultural Economist who have been engaged in socioeconomic research and
community development work for 14 years and have a real sense of the damage of poverty)
on one hand, and the recent mission and program strategies of CCF – an agency which have
working for wellbeing of disadvantaged children since 1938, to work for child development in
holistic manner-under the strategic framework of Holistic Child Development. However, this
initial proposition get wider as I read more literatures related to the subject and attended the
interesting courses of the Institute. After a series of informal discussions with my professors
on my proposition, the proposition become fully developed ‗research‘ proposal by April-2003,
which I presented it to my professors-Prof. Roberchet Renard and Dr. Nathalie Holvoet.
Although it was too ambitious, my professors accepted my proposal due to my insistence and
Dr. Nathalie Holvoet became my promoter.
With the close advice, guidance, corrections and encouragement I abundantly obtained from
Dr. Nathalie, and insight I got from her well organized course- ‗Quantitative Evaluation
Techniques‘ in addition to my research and data analysis skills and experiences, I believe this
Dissertation was written to the highest possible professional standards. And thus my very
special thanks go to Dr. Nathalie Holvoet. I thank also Prof. Renard for his initial inputs
which help me to think different ways of modeling determinants of child wellbeing. In
addition to Prof. Renard, the extraordinary professor of the Institute, I am very grateful for Dr.
Johan Bastiaensen, and Dr. Danny Cassimon for broadening my view of development
thinking through their interesting and interactive courses, otherwise this paper won‘t have
such scope.
My study at the Institute was made possible by the special support of CCF. Although this
paper, which is much wider, deeper and analytical than the initial proposition, is to the benefit
of CCF, I want to express my genuine gratitude to the Managment of CCF –Ethiopia National
Office, CCF Regional office in Nairobi, Kenya; and CCF HQ in Richmond, Virginia, USA;
specifically to Mr. Fikru Abebe, Mrs. Margery Kabuya, and Mr. Daniel Wordsworth. I am also
deeply indebted to Dr. Azene Bekele-Tessema, for his special encouragement and support.
Although I couldn‘t find special words to express my feeling, the grand overarching thanks
and appreciation is for my wife, Mrs. Tilashwork Etsub. Had it not been due to her special
follow-up to submit my application for admission to the Institute before the deadline,
encouragement, love and compassion, good will and commitment to raise our four sons alone
for a year, it would have been impossible for me to come to Belgium and study at the Institute.
Last but not least my mother have special place in my academic life. It is due to her special
effort I managed to complete my high school education, and obtained my first degree from
Alemya University, Ethiopia.
My sons deserve special apology not a vote of thanks. Thus I apologize for my elder son
Amanuel-6, the twins Fikereselam and Hibret- 3.9/12 and the new comer Emnet 1.7/12, who
deprived, for the reason unclear to them, the care and compassion a father should have to
proved to his sons.

I. Introduction
“As today's children are the citizens of tomorrow's world, their survival,
protection and development is the prerequisite for the future development of
humanity. Empowerment of the younger generation with knowledge and
resources to meet their basic human needs and to grow to their full potential
should be a primary goal of national development. As their individual
development and social contribution will shape the future of the world,
investment in children's health, nutrition and education is the foundation for
national development.‖ United Nations Declaration–World Summit for children 1990.
Following the Convention on the Right of the Child (CRC), which was
unanimously adopted by the General Assembly of the United Nations in 1989, the
World Summit for Children held at the United Nations in September 1990. On
the 30th of September 1990, the World Declaration on the Survival, Protection and
Development of Children and the Plan of Action for Implementing the World
Declaration were signed by 71 heads of state and governments, and was later
endorsed by 181 countries. The Plan of Action lay down seven major goals that
were considered achievable by the year 2000. Most of the goals of course later
become Millennium Development Goals (MDGs). The seven major goals are the
following:
(1) Reduction of 1990 under-5 child mortality rates by one third or to a

level of 70 per 1,000 live births, whichever is the greater reduction;
(2) Reduction of maternal mortality rates by half of 1990 levels;
(3) Reduction of severe and moderate malnutrition among under-5
children by one half of 1990 levels;
(4) Universal access to safe drinking water and to sanitary means of excreta
disposal;
(5) Universal access to basic education and completion of primary
education by at least 80 per cent of primary school age children;
(6) Reduction of the adult illiteracy rate to at least half its 1990 level (the
appropriate age group to be determined in each country), with
emphasis on female literacy;
(7) Protection of children in especially difficult circumstances, particularly
in situations of armed conflicts.
The Plan of Action called for national action and international co-operation to
meet the goals set in the Plan. Governments were urged to prepare national plans
of action (NPAs) for the implementation of these goals. At the international level,
international agencies were asked to assist underdeveloped and highly indebted
poor countries in the achievement of their plans of action (World summit for
children, 1990).
End-decade review report of the United Nations, presented by the Secretary-

General Kofi Annan, on the Special Session of the United Nations in June 2001
indicated that many of the seven major goals of the 1990 Plan of Action
achievements were less than impressive. For example: under-five mortality rate
only declined by 11 percent (rather than the goal of 33 percent), malnutrition
declined by 15 percent (rather than 50 percent), there was no real progress in the
reduction of maternal mortality (the goal was a 50 percent reduction) and
universal access to safe drinking water and hygienic facilities is far from a reality
(UN, 2001).
It is often said that in many United Nations conferences, goals are ever set but
never met, and that commitments on paper are rarely translated into action on the
ground. But what hampered the achievement? The report of the secretary general
emphasized that beside lack of commitment and insufficient investment by
government and donors, chronic poverty remains the single biggest obstacle to
meeting the needs and fulfilling the rights of children. On the other hand,
UNICEF report on The State of the World's Children 2002 depicted that there is no
fixed relationship between the annual reduction rate of the U5CMR and the
annual rate of growth in per capita GDP. But, if growth is good for poor as David
Dollar & Aart Kraay (2001) are arguing, and if poverty is the biggest obstacle,
there should have been a robust relationship between growth and the rate of
reduction of U5CMR.
Overall, although there are a number of hypothesis, suggestions, debates and in

some cases findings as to what intervening factors affecting child wellbeing,
particularly in the case of child mortality, child nutrition and child education;
there are inadequate empirical research and findings as to the circumstances or
factors that hindered the achievement of the Summit goals and/or contributed to
the variations among the regions and among the countries within and across the
regions.
This paper will explore the extent of variability among developing countries and
look into the broad forces that account for the cross-country variation in the
(under) achievement of three major goals that directly measure child wellbeing.
These include: (1) reduction of under-5 child mortality rate; (2) reduction of severe
and moderate malnutrition among under-5 children, (3) universal access to basic
education (primary school enrollment)
The paper will uncover some of the causes for (under) achievement of the goals
by dissecting the major socio-economic environment of the developing countries
such as macroeconomic performance, government budget allocation, foreign aid
and private financial flows, the level and depth of poverty, and other endogenous
and exogenous factors affecting child wellbeing in developing countries with the
aid of simple statistics as well as rigorous econometric methods.
As a concluding remark this paper will priorities the determinants of child wellbeing
among the broad forces, and major actions to be taken by the donors and governments of
developing countries to meet and sustain the Millennium Development Goals related to
long term child survival, protection and development.

II. Hypothesis and Methodological Approaches

2.1 Hypothesis
The starting hypothesis of this paper is that there could be considerable variation
in rates of change of child wellbeing indicators between developing countries.
And this variation is most probably affected by macroeconomic performance and
government budget allocation of the developing countries; foreign aid and private
financial flows into developing countries; the level of poverty and inequalities in
developing countries; as well as due to other endogenous and exogenous factors
such as HIV prevalence, domestic conflict, adult literacy and access to information
and communication services.
This hypothesis just served as starting point or guiding star. The full theoretical
framework and elaborated hypothesis is presented in section 4 and the functional
relation is given in the last section of this paper.
2.2 Methodical approaches
2.2.1 Review of similar studies and relevant literatures
Extensive review of similar studies/journal articles and relevant literatures,

produced by UN systems, NGOs and private publishers as well as national
governments has been done as the primary task of this paper. Emphasis was,
specifically, given to publications from professional journals, the World Bank,
different UN organizations (UN-HCHR/CRC, UNICEF-ICDC, UNDP, UNESCO,
WHO), Child Right Information Network (CRIN), Save the Children Sweden,
Save the Children Alliance, The Future of Children.
The result of the reviews served as initial steps, on one hand to narrow down the
type of information I had to focus at, and on the other hand, to compare and
contrast previous findings with that of mine.
2.2.2 Data coverage and sources
The data required for this study were based on the three most important child
wellbeing indicators of developing countries, which include (1) Under-5 Child
Mortality Rate (U5CMR) , (2) prevalence of Under-5 malnutrition and (3) access to
basic education (primary school enrolment), as outcome variable. Where possible
these data were disaggregated by gender, specifically for primary education.
The explanatory variables which are assumed to have most probable influences
on the achievement of the above three major goals of the Summit― the focus of
this paper― are as follows
a) Macroeconomic performance [as measured by: the long term GDP per
capita growth rate (1960-1990), GDP per capita growth rate during the

decade (1990-2000), level of inflation during the decade (1990-2000) ], as

well as central government expenditure allocation for the Health Sector,
the Education Sector, and for Defense.
b) The level and intensities of foreign aid & financial flows that includes:-
Aid per GNI, Aid per Capita, Foreign Capital Flows, and Total Debt
Service.
c) Poverty & Inequality as measured by Poverty Headcount Index, Poverty
Gap (depth of poverty), Gini Coefficient (Gini Index).
d) Others include: Overall aggregate measure of political freedom and civil
liberties by Freedom House, HIV Prevalence Rate, Domestic Conflict
Index, Adult Literacy Rate.
Data on these variable were collected and adapted form existing databases mainly
from World Development Indicator CD-Rom (2000/2001) of the World Bank;
UNICEF; UNESCO; OECD; U.S. Bureau of the Census; International Data Base,
Cross National Time Series (CNTS) Database-from Alexander Library-Rutgers
University; and The Freedom House.
The macro level data are basically annual averages or changes during the decade
(1990-2000), except when constrained by missing data sets. Data on some
variables, for example log term GDP per capita growth rate, was of course
collected starting from 1960 to see the impact of a log term and short term
economic progress on child wellbeing. Any data set with a specific period of time
is specified in the paper. The details of variables and data types collected, as well
as its sources, are presented in Annex-1.
2.2.3 Data Analysis and Presentation
A series of Data Mining procedures were followed, as an analytic process, to

explore consistent patterns and/or systematic relationships between variables,
and then to validate the findings by applying the detected patterns to the data sets
or subsets. The data were organized using MS Excel-2002 and all simple and
sophisticated analysis were done using SPSS (Statistical package for Social
Scientists) version 11 for Windows. Necessary graphics were developed using
both MS Excel and SPSS graphic facilities.
Stage 1: Exploration. This stage started with data preparation which involved
cleaning data; data transformations using logarithmic, quadratic, and inverse
functions; selecting subsets of records. In this process regions or islands politically
dependent on another country were excluded from the sample. Small countries or
small independent islands with a population of considerably less than one million
were also excluded as they are less representative and bias estimation of
parameters for functional relationship. Somalia is intentionally excluded for 2
reasons. 1) Next to United States, Somalia is the only country in the world that has
not signed CRC; 2) Due to the continuous war the country was stateless
throughout the decade and many data were missing. Thus only data from 105
developing countries included in this paper (see annex-2 for list of countries.)
Stage 2. Exploratory analyses. Depending on the nature of the variables, at this

stage, exploratory analyses were extensively carried out using a wide variety of
graphical and statistical methods in order to identify the most relevant variables
(from more than 100 direct and transformed variables) and to determine the
pattern of association and the general effect of explanatory variables on
dependent variables. See annex --- for details of the direct and transformed variables.
Stage 3: Model building and validation. This stage involved considering various
models and choosing the best one based on their predictive performance (i.e.,
explaining the variability in question and producing stable results). The
significance of contribution of each explanatory variable in affecting the child
wellbeing indicators was tested by including and excluding from the model
alternatively.
Stage 4: Deployment. That final stage involved using the model selected as best
in the previous stage and applying it to the data in order to generate predictions
or parameters estimates of the expected outcome. At this stage, the main analysis
were Multiple Regression using Generalized Regression Model (GRM) in which
linear, semi log linear and semi-quadratic linear models were used - based on the
nature of each explanatory variable and its association with the dependent
variable(s).
The data analyzed at aggregate level were primarily used to generate information
to test the hypothesis and give answer to the research question- ‗what hampered
the achievement of the three selected goals set by the world submit for children?‘.
The results of my analysis were compared and contrasted with previous studies
and literature for the synthesis of the information and to draw up conclusions.
2.2.4 Data limitation
There were a number of missing data for most of the variables included in this paper.
Complete set of data required for this paper were only available for some countries,
despite a series of effort to pool from various sources. Consequently data used in
regression analyses range from 34 to 51 countries. However, as the qualities of the data
were crosschecked from different sources, the author believes that missing data cases did
not have much influence on the result of the analyses.

III. The Status of Children in Global Context
3.1 Children in global demographic context
Globally young people under the age of 18 represent more than one third of the
world‘s population. According to U.S. Bureau of the Census, International Data
Base; of the total population of the world in mid 2000 which was estimated to be
6,078,270,552 (M/F ratio being 101.4) under 19 children population was about
2,376,472,672, which is nearly 40% of the world population (fig1). If we look for
under 15 years old children, ‗the economically in active‘ group they account for
about 30% of the world population, or they are 1,815,145,237, (M/F ratio being
105.2.). The population of the most vulnerable group, under 5 children, was
about 607,770,690, which is exactly 10% of the world population.
The share of children in Developing Countries is considerably higher than that of

the world average (fig.1). Of the total population of 4,886,299,890 (M/F ratio
103.2) in Developing Countries; under 19 children were estimated to be 42.5%
(2,077,104,987) M/F ratio being 105.3 while under 15 children are about 33%
(1,597,456,528) M/F ratio being the same.
Fig.-1 Relative population (percent) of children of different age category in the glob
and different groups of countries (by the year 2000)
45
40
35
30
Percent Children
(age 0-4)
25
Percent Children
20 (age 0-14)
Percent Children
15
(age 0-19)
10
0
WORLD LESS DEVELOPED MORE DEVELOPED
(DEVELOPING) COUNTRIES COUNTRIES
Sources: Graph & summary produced by the Author from U.S. Bureau of the Census, International Data Base
When we dissect the data further by regions, we can observe considerable

variations between regions of Developing Countries (fig. 2). While Asia
(excluding Middle East) and Latin America and the Caribbean are closer to world
average for the three age categories of children, the proportion of children in Sub-
Saharan Africa is much higher than the world average as depicted in the
following figure (fig. 2). Of the total population of Sub Saharan Africa- 656,548,110
(M/F ratio-99.5), more than 55% (362,444,385; M/F ratio 101.1) are children under
age of 19 years, and under 15 years old children account for 44%. The population
of the most vulnerable group, under 5 children, was about 110,419,275, which is
almost 17% of the Sub-Saharan African population.
Fig.-2 Relative population (percent) of children of different age category in

different regions of Developing countries (by the year 2000)
60
50
Percent Children
(age 0-4)
40
Percent Children
(age 0-14)
30
Percent Children
(age 0-19)
20
10
0
SUB-SAHARAN NORTHERN NEAR (MIDDLE) ASIA LATIN AMERICA
AFRICA AFRICA EAST (EXCLUDING AND THE
MIDDLE EAST) CARIBBEAN
Sources: Graph & summary produced by the Author from U.S. Bureau of the Census, International Data
Base
Although there is considerable variation between regions of the Developing

Countries (fig. 2) and in the world as a whole, the only country in the world
where share of children under age of 19 falls below 20% are Italy and Monaco1.
Among the developing countries excluding Hong Kong and Singapore, which are
of course categorized by DAC (2003) as ‗more advanced developing countries‘,
the proportion of children under 19 year age, ranges form 26.7% in St. Helena
(islands in south Atlantic with autonomous territory status) to 61.9% in Uganda;
while proportion of children under the age of 15 ranges from 19.4% to 51.1% for
the same countries respectively.
Despite this significant share of world population, adequate emphasis was not
rendered and considerable research was not done with regards to child
development in developing countries, where children have been facing a number
of socioeconomic problems and become victims of poverty, poor governance, civil
unrest, etc. Subsequently, they deprived the right to education and adequate
nutrition. In worst scenario, which is not uncommon for developing countries,
they denied the freedom to survive. We will see in the following section the
1
Monaco is a tiny town with about 31,000 people, but independent state in southern France.

situation and status of children in developing countries in details in terms of

mortality, nutrition and education before we proceed to analysis of the influence
of various factors on the life of children.
3.2 Child mortality in developing countries during the decade
The first goal of the World Summit for Children was, between 1990 and 2000, the
reduction of under-five child mortality rate (U5CMR)2 by one third (33%) or to 70
per 1,000 live births (LB), respectively, whichever is less.
In the world as a whole (see table-1 below), there was a big move between 1960 to
1990, and U5CMR declined from 198 to 93 per 1000 LB- with average annual rate
of reduction of 2.5%. This pace was slowed during the decade of the summit and
U5CMR was only reduced by about 10 per cent over that period. Currently the
world U5CMR stands at 83 per 1000LB.
Under-five mortality in developing countries declined from 103 per 1,000LB in

1990 to 93 per 1,000 LB in the year 2000. Ten years ago, it was the children of
Africa, of Sub-Saharan Africa (SSA) in particular, whose needs were most acute,
and yet it is in this region that the least progress has been made during the
decade. Only 3% reduction of U5CMR was attained in the region, which is
extremely low as compared to not only the target but also in eyes of the progress
made by other regions: Middle East and North Africa (20%), South Asia (22%),
East Asia and Pacific (24%) and Latin America and Caribbean (31%). SSA is still
the region with the highest child mortality rate. In this region 175 of 1000
newborns (17.5%) do not live to the age of five.
Table-1 Under 5 child mortality rate and its rate of reduction in developing regions of
the World (1960-2000)
Decade
Under-5 mortality rate Average annual rate reduction
Regions/Groups of per 1000 live birth of reduction (%) (%)
countries 1960 1990 2000 1960-90 1990-2000 1990-2000
Sub-Saharan Africa 254 181 175 1.1 0.3 3
Middle East and 250 80 64 3.8 2.2 20
North Africa
South Asia 244 128 100 2.1 2.4 22
East Asia and Pacific 212 58 44 4.3 2.7 24
Latin America and 153 53 37 3.5 3.7 31
Caribbean
Developing countries 223 103 91 2.6 1.2 11
in general
World Average 198 93 83 2.5 1.1 10
Source: UNICEF - The state of the World‟s Children 2002.
2
Under-5 mortality rate is defined as the probability that a newborn baby will die before reaching
age five, if subject to current age-specific mortality rates. The probability is expressed as a rate per
1,000 live births (LB)- UNICEF‘s State of the World‘s Children 2002.

Out of 62 countries, for which data on female-male child mortality difference is

available (WDI, 2001), 22 countries are neutral (+/- 1%), while 20 countries found
to be biased against female and the same number of countries found to be biased
against male. Nigeria is exceptional country where female –male child mortality
rate difference is too alarming (84 per 1000 LB); i.e the rate of female child
mortality per 1000 LB of female is higher than rate of male child mortality per
1000 LB of male by 84. Excluding Nigeria as unique outlier, the median is zero,
mean = -07, SD =6.48. This implies that that although there is no considerable
difference between male and female child mortality rate in developing countries
as whole, there is too much variation among countries.
Ironically U5CMR has increased in 13 developing countries. The list of developing

countries where child mortality has actually increased during the decade includes
9 Sub-Saharan Africa countries (Angola, Botswana, Cameroon, Côte d‘Ivoire,
Kenya, Rwanda, South Africa, Swaziland, Tanzania, Zambia, Zimbabwe), Algeria
and Iraq (in North Africa & Middle East), Cambodia from East Asia and Pacific,
and Kazakhstan and Uzbekistan from CEE/CIS and Baltic States region
Despite overall inadequate achievement of the envisaged goal, more than 40

developing countries achieved the targeted one third reduction of U5CMR. Many
of the countries that achieved the goal are those enjoyed reasonable economic prosperity
during much of the decade. But some upper middle income countries, with positive
per capita GDP growth rate during the decade, did not achieve the goal. For
example Argentina, Barbados, Costa Rica, Panama, Saint Lucia, Trinidad and
Tobago, Uruguay (from Latin America & Caribbean); Botswana, Gabon,
Mauritius and Seychelles (from SSA), and Bahrain and Lebanon (from Middle
East). On the other hand some very poor countries with per capita income of less than
US$ 760, and with nil or meager per capita GDP growth rate during the decade, did
achieve the goal; for example, Bangladesh, Bhutan, Comoros, Lao, Nepal, Nicaragua.
Why did this happen? What intervening factors played the role? This is part of the
issue we are going to look into- in details- in the subsequent sections.
3.3 Child nutrition status in developing countries during the decade:
In 1990, 177 million children under five years of age in developing countries were
malnourished (underweight), as indicated by low weight-for-age ratio3. An
estimate of ACC/SCN (2000) indicates that 149 million children were
malnourished in the year 2000.
3
Under weight is defined as low weight- for- age at less than –2 standard deviations of the
median value of the NCHS/WHO international growth reference. Under weight (low weight- for-
age ) is different from ‗Wasting‘: low weight- for- height and ‗Stunting‘: low height-for-age. Low
weight-for-age reflects body mass relative to chronological age. It is influenced by both the height
of the child (height-for-age) and his or her weight (weight-for-height), and its composite nature
make it superior to both though its interpretation is sometimes complex. (WHO,
www.who.int/nutgrowthdb/intro_text.htm)

The prevalence of under-five malnutrition4 in developing countries as a whole

decreased from 32.1 percent to 26.7 percent (fig-3). The goal to reduce malnutrition
in under-five children by half has been, therefore, very far from being achieved.
Fig.-3 Prevalence of Under 5 Child Malnutrition in Developing Regions of the World

(1990 and 2000)
60
1990 2000
50
% of Under 5 Children Underweight
40
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20
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Source: Graph produced by Author based on data from ACC/SCN (2000) Fourth Report on the World
Nutrition Situation.
When we look into the regional differences, of course some regions made
considerable progresses. The most remarkable progress has been in Latin America
and Caribbean, which shows a decrease in child malnutrition rates from 10.2 to
6.3 percent. This is particularly due to progress registered in South America
continent that registered a decrease in child malnutrition rates from 8.2 to 3.2
percent, where as, in contrast there was no progress in Central America, although
malnutrition rate of about 15% is better in the eyes of other regions. Progress was
low in Asia (as a continent), where rates decreased from 36.5 to 29 percent and the
number of under five underweight children fell by some 33 million (from 141.31
million to 107.91 million). This implies that still, more than two thirds of the
world‘s malnourished children (some 108 million out of 149 million) now live in
Asia as a continent. Despite the heralded economic progress, Asia-especially
South Central Asia- is the region where malnutrition rate is the highest (43.6%).
And it is in this region where 50% of the world malnourished children live.
4
Prevalence of child malnutrition (low weight-for-age) is the percentage of children under five whose
weight for age is less than -2 standard deviations of the median value of the NCHS/WHO
international growth reference population aged 0 to 59 months/under 5 year age (WDI, 2001)
In Africa the prevalence of malnutrition is closer to world average. However, it is

the continent that shows retrogression in feeding its children, except in North
Africa region. The absolute number of malnourished children in Africa has
increased from 30 million in 1990 to 38 million by the end of the millennium. Why
this did happen? Was it due to pervasive poverty, or war and domestic conflict or
inadequate attention of the government of African nations, who usually like to
invest in military than social services or other hidden factors? We will see the
analysis in relation to these and other factors in subsequent section of this paper.
Although gender disaggregated data was not available to look into the gender
disparity in malnutrition, ACC/SCN Fourth Report on the World Nutrition
Situation reveals that there are no differences in prevalence rates for boys and
girls for under weight, stunting or wasting (ACC/SCN, 2000, pp: 8)
3.4 Child Education (Primary school enrolment) in developing

Countries during the decade:
According to UNESCO Institute for Statistics data base, net enrollment ratio
(NER)5 in the developing countries of the world increased on the average from
79.8% in 1990/91 to 82.1% in 2000/01, while the world average moved from 81.9
to 83.6 respectively. This implies the World Summit goal of „universal access to
basic education‟ has not been achieved. The 2002 Education for All Global
Monitoring Report of UNESCO depicts that there are still more than 100 million
children of school age who remain out of school. According to the report nearly
all out-of-school children live in developing countries, and a majority of them are
girls
The breakdown of NER by regions shows that there are considerable variations
between the regions. Some regions, in fact, are barely keeping up with the growth
in the number of school-age children and a few are falling back (fig-4)
The most notable progress has been in Latin America and Caribbean, North
Africa, and Oceania where net enrollment increased by 9.7%, 8.8% and 7%
respectively. South-central Asian enrollment also increased by 6%. The Eastern
Asia and South-Eastern Asia regions, where the net enrolment ratios have been
closer to 100 per cent by 1990/91, fell back in 2000/01 by 4.2 and 1.1 percent
respectively. However, in these regions NER still stands above 90%, which is far
above the world average. The region far away from the Summit goal of ‗universal
access to basic education‟ is sub-Saharan Africa, which stands at 57.7% of NER.
5
The net enrolment ratio (NER) expresses the number of pupils at a given level of schooling-
taking into account the age structure of those enrolled- as a proportion of the number of children
in the relevant age group by excluding all those children who are older or younger than the
officially school-eligible age group. (UNESCO, 2002)

Fig.-4. Net Enrollment Ratio in Primary School in Different Regions of the

World: 1990/91 and 2000/01 comparison
100.0
1990/91 2000/01
90.0
80.0
Net Enrollment Ratio In Primary (Total)
70.0
60.0
50.0
40.0
30.0
20.0
10.0
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Source: Graph produced by Author based on UNESCO data base
The breakdown of net enrolment ratio by region gave us some more insight but it
still masks considerable variations between and within countries. Despite the
steady progress seen in the regions of the Latin America and Caribbean and in the
Arab States, there is overall variability within all regions. Some countries, in fact,
are barely keeping up with the growth in the number of school-age children and a
few countries are falling back.
Out of 73 developing countries, for which data is available both at the beginning
and end of the decade, the rate of enrolment was worsened in 28 countries. These
includes 9 countries in SSA (Angola, Botswana, Comoros, Kenya, Mauritius ,
Namibia, South Africa, Tanzania, Zimbabwe), six countries in East Asia and
Pacific (Indonesia, Korea-Republic of, Mongolia, Myanmar, Philippines, Samoa),
four from Latin America and Caribbean (Jamaica, Paraguay, Uruguay, and
Venezuela), six from North Africa and Middle East (Bahrain, Djibouti, Oman ,
Saudi Arabia, Syrian Arab Republic, United Arab Emirates), 2 countries from
CEE/CIS and Baltic States (Georgia and Kyrgyzstan), and 1 form South Asia
(Nepal)
On the other hand 18 out of 73 developing countries have managed to increase net
primary enrolment by more than 10% during the decade. These includes 8 Sub-
Saharan Africa countries (Chad, Côte d'Ivoire, Eritrea, Ethiopia, Malawi,
Mauritania, Senegal, and Togo); Argentina, Brazil, Colombia, and Suriname (from

Latin America and Caribbean); Lao and Vanuatu (from East Asia and Pacific);
Bangladesh and Pakistan (from South Asia); Morocco (from North Africa and
Middle East) and Tajikistan (from CEE/CIS and Baltic States).
The following figure (fig-5) further depicts how variability looks like between and
within the regions. The figure shows that the variation is much higher among
SSA and North Africa and Middle East, the majority of them being Arab states
and very low among East Asia and the Pacific countries. Variation in CEE/CIS
and Baltic States, South Asia as well as Latin American and Caribbean regions
also attract attention as to what are the causes or intervening variables associated
with the variations. The three to four-fold difference in NERs between the top
and bottom ranking countries of sub-Saharan Africa, and of the Arab States and
North Africa calls for a further and close look into the issues. We will see this in
the following sections (section-IV on wards).
Fig.-5 Variation in Net Enrollment Ratio-Primary School in Different Regions

of Developing World in the Year 2000/01
120.0
Uganda
Argentina
Tajikistan
Korea Rep. 109.5
107.5
Tunisia Maldives
102.6 Malawi (100)
100.0 99.5 99.2 99.0
92.4 92.5
88.7 89.6
81.4 80.7
Net Enrollment Ratio-Primary
80.0 80.6
Nicaragua
Lao PDR Kenya (68%)
69.2
Armania Pakistan66.3 64.8 Max
60.0 Saudi Arabia Median
Ethiopia (47%) Min
40.0
32.6
Djibuti Niger 30.4
20.0
0.0
CEE/CIS and Baltic East Asia and Latin America and North Africa and South Asia (4/8) Sub-Saharan Africa
States (5/10) Pacific (16/30) Carribean (24/33) Middle Eastmercia (32/47)
(16/21)
Source: Calculated and Graph produced by the Author from UNESCO data base
The female-male difference in getting access to primary education
From a strategic point of view, one of the key aspects that deserve attention with
regard to primary education is the gender dimension. Although it is being
narrowed down in some regions and countries, the gender gap in terms of the
difference in school enrolment ratios between girls and boys is, in most cases, to
the disadvantage of girls.

Fig.-6 Net Enrollment Ratio–Primary Education in the Year 2000/1 in

Developing Regions of the World by Sex.
100.0 97.1
96.0
93.6 94.9
92.1 92.4
89.2 90.6 90.0
90.0 85.5 86.0 85.9
84.8
80.1 79.5 81.1
79.1
Net Enrollment Ratio-Primary Education

80.0
72.4
70.0
60.4
60.0
55.0
50.0
40.0 Male
30.0
Female
20.0
10.0
0.0
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Source: Graph produced by the Author from UNESCO data base
The gap has narrowed considerably in recent years in the two regions where it
was the greatest: in South Central Asia (Middle East) and North Africa (Table-2).
Despite considerable progress, there is a great deal more to be done in these
regions and elsewhere. In sub-Saharan Africa and Western Asia Female-Male
difference in NER of Primary Education has almost remained unchanged over the
past 10 years. Ocean has a sub-region in getting worse in widening the gap during
the decade while East Asia sub-region became a favorite for girls.
Table-2 Female-Male Gap in NER in the Developing Regions of World (1990 & 2000)
Female- Male Gap in NER of
Primary Education Change in the
Region 1990 2000 gap
Northern Africa -13.7 -4.3 9.4
Sub-Saharan Africa -8.3 -5.3 3.0
Latin America and Caribbean -1.1 -1.0 0.1
Eastern Asia -3.8 2.8 6.6
South-Central Asia -28.0 -13.1 14.9
South-Eastern Asia -3.9 -1.9 2.0
Western Asia -12.0 -9.9 2.1
Oceania -2.8 -6.5 -3.7
Developing Regions Average -12.2 -5.6 6.6
World Average -10.4 -4.9 5.5
Source: Calculated by Author from UNESCO data base

Large disparities persist both among and within countries — the latter often
hidden by national averages. Out of 72 developing countries, for which data are
available both for 1990/91 and 2000/01 academic year, Female-Male difference in
NER-in primary education was worsened in 22 countries. These include eight
countries from Sub-Saharan Africa region (Angola, Burkina Faso, Burundi, Côte
d'Ivoire, Eritrea, Ethiopia, Mauritius, Mozambique, South Africa), six countries
from Latin America and Caribbean (Argentina, Brazil, Chile, Colombia, Cuba,
Suriname), Kazakhstan, Kyrgyzstan, Tajikistan from CEE/CIS and Baltic States,
Samoa and Thailand from East Asia and Pacific, and Pakistan from south Asia
On the other hand some 28 countries were able to narrow down the gender gap in
education. Some are even turn out to be favoring girls in primary education. The
majority are East Asian and pacific countries (9), which include Indonesia, Lao,
Macau, Malaysia, Mongolia, Myanmar, Philippines, Vanuatu and Viet Nam, 8
countries from North Africa and Middle East (Algeria, Bahrain, Egypt, Morocco,
Oman, Saudi Arabia, Syrian Arab Republic and Tunisia; about eight countries
from SSA (Comoros, Ghana, Kenya, Madagascar, Malawi, Mauritania, Senegal
and Tanzania); five Latin America and Caribbean countries (Bolivia, Mexico,
Paraguay, St. Lucia, and Trinidad and Tobago); Bangladesh from South Asia and
Georgia from CEE/CIS and Baltic States.
Courtiers known for discriminating girls in primary education as compared to

boys, i.e. where Female-Male differences in NER for primary education exceeded -
10% by the beginning of the new millennium, are Yemen (-35%), Chad (-23%),
Pakistan (-20%), Central African Republic (-19 %), Togo and Côte d'Ivoire (-18%),
Burkina Faso, Ethiopia and (Niger (-12%), Guinea (-11%), Nepal, Burundi and
Cambodia (-10%)6
Even in countries where quantified gaps are minimal, inequalities in educational

content, methods and facilities may exist, resulting in major differences in
achievement. In countries where the economy is declining and enrolments are
falling, girls may fall behind even further. Where access to information and
communication is low, illiteracy is high and traditional beliefs and practices
remain strong, girls may be expected to become housekeepers, child minders and
wives at an early age. We will, in the subsequent sections see how and the extent
to which these situations imposed influences on the under achievement of the
Summit goal of universal access to primary education, and impose discriminatory
effect on girls education.
6
There was no data for 1990/91 academic year for Cambodia, Guinea, and Yemen to talk about progress if
there is any.

IV. What hampered the World Summit for children?
4.1 Review of End-decade report of the United Nations Secretary-

General and other UN Agencies.
The end-decade review report of the United Nations Secretary-General (2001),

with the title ‗We the Children‘, indicated that lack of commitment and
insufficient investment by government and donors, chronic poverty, the
pandemic of HIV/AIDS, lack of essential care for the newborn baby, and
unprecedented levels of ethnic conflicts and civil wars as the most prominent
obstacles to meeting the needs and fulfilling the rights of children.
According to Secretary General Report (2001), the success of some countries can
be attributed to specific child-friendly policies, strategies and programmes and
concrete measures taken at the national and sub-national levels, to save children‘s
lives. However, in some cases the impact of effective policies and programmes
was, unfortunately, overwhelmed by such disasters as war, economic crisis, and
natural disasters and, especially, the AIDS pandemic in sub-Saharan Africa (UN,
2001)
The United Nations Administrative Committee on Coordination the Sub-

Committee on Nutrition (ACC/SCN) Fourth Report (2000) on the World
Nutrition Situation depicts that poverty, low education level and status of women
and poor care during pregnancy, as well as high population densities and
unfavorable child-care practices, are major underlying causes of malnutrition in
Asia, especially in South Asia, where malnutrition is most prevalent. The Report
also indicated that weaknesses in public sector administration and sometimes a
lack of commitment to support local initiatives have hampered the
implementation of nutrition policies which aimed to empower families and
communities. Conflicts, natural disasters and the HIV/AIDS pandemic have also
greatly exacerbated the situation of malnutrition (ACC/SCN, 2000).
Office of the High Commissioner for Human Rights/ Committee on the Rights of
the Child, on its ‗Tenth Anniversary of the Convention on the Rights of the Child
Commemorative Meeting‘, deliberated the fact that economic policies are never
child-rights neutral. And the committee calls on civil society to assist it in seeking
the support of key international leaders, and in particular the High Commissioner
for Human Rights, the Executive Director of UNICEF, and the President of the
World Bank, to examine how macro-economic and fiscal policies impact on
children's rights, and how these policies can be reformed so as to make them more
beneficial to the implementation of the rights of the child (Palais des Nations,
1999).
On the other hand, UNICEF report on The State of the World's Children 2002
argued that there is no fixed relationship between the annual reduction rate of the
U5CMR and the annual rate of growth in per capita GDP. But, if growth is good

for poor as David Dollar & Aart Kraay (2001) were arguing, and if poverty is one
of the biggest obstacles (according UN Secretary General Report (2001), there
should have been a robust relationship between growth and the rate of reduction
of U5CMR. These contrary and also contradictory views call for looking into other
factors which determine the ratio at which economic progress contributed to
social progress.
The study report by the World Bank ‗The Role and Effectiveness of Development
Assistance: Lessons from World Bank Experience‘ and the comment of the
Secretary General of the United Nations with regards to the lack of commitment
and insufficient investment by government and donors is seems to be at odds
with each other. The study report of the World Bank indicates that Governments
of developing countries, with the support of the development community and
non-governmental organizations (NGOs), have accelerated growth and poverty
reduction by improving their policies, institutions, and through well designed
projects and programs. The study report further emphasized that well-allocated
foreign aid has been an effective means of supporting poor countries and poor
people in their efforts to improve their lives. And with improved allocation and
better design and delivery of assistance, aid is more effective today than ever
before (World Bank 1998, 2002). But the statistical evidence of world bank study
mainly demonstrated how large-scale financial aid and (‗good‘) policy interaction
can generally affect poverty reduction, and didn‘t come up with how financial aid
can specifically affected child wellbeing. There is also strong argument from some
scholars that the World Bank's success story rests on an extremely weak
foundation from ‗aid-loan‘ allocation and statistical point of view (Peter
Nunnenkamp, 2002).
On the other hand the Realty of Aid Report (2002) strongly argues the negative
effect of massive multilateral and bilateral àid loans' as related to debt service.
According to the Report the evolution of the debt crisis, that emanate from
massive multilateral and bilateral àid loans' tied to debt repayments and
structural adjustment policies, were in fact pressed developing country
governments to service their debts to Northern creditors at the expense of meeting
extreme and expanding social needs.
Overall, although there are a number of hypotheses, suggestions, debates and in

some cases findings as to what intervening factors affecting child wellbeing,
particularly in the case of child mortality, child nutrition and child education;
there are inadequate empirical research and findings as to the circumstances or
factors that hindered the achievement of the Summit goals and/or contributed to
the variations among the regions and among the countries within and across the
regions. Moreover, although previous studies and country experiences have
suggested a number of factors or circumstances that affect the performance of a
given country‘s socio-economic development; the mechanism through which it is
associated with child wellbeing has yet to be explored.

4.2 The theoretical Framework

From the above background, starting hypotheses, and theoretical point of view
we can develop a framework of the major hindrances or circumstances
detrimental to child wellbeing. The framework, theoretical construct, is best
illustrated in the schematic diagram (fig.-7) presented below to ensure
Preoperational Explication of the Construct for the mechanism through which
each is associated with child wellbeing. Based on the background information of
the preceding sections, four major (broad) forces and three contributing factors
assumed to be the most probable intervening variables detrimental to child
wellbeing (measured in terms of child mortality, child nutrition and primary school
enrolment.) The four major broad forces included in the theoretical construct
include:
(1) Unhealthy (macro)economic performance.
(2) Misdirected priority in budget allocation by government
(3) High level of poverty and inequality.
(4) Low level of foreign aid/financial flows & high dept service;
The other contributing factors include:

(a) Bad governance and low civil liberties;
(b) Prevalence of HIV/AIDS and domestic conflict,
(c) Low levels of literacy (especially mothers).
These determinants will, of course, be measured using a number of variables or

indicators when we come to empirical analysis. The inclusion of four broad forces
and three contributing factors and further split of the broad forces into a number
of variables or indicators will ensure the construct validity; as this certainly
overcome Mono-Operation Bias.
Measuring child wellbeing in terms of child mortality, child nutrition and enrollment
in primary education instead of picking one indicator- such as child mortality which
is referred as the single most important indicator of child wellbeing (UNICEF,
2002) will also overcome Mono-Method Bias.
As depicted in the schematic diagram, the mechanism through which each factor
affects child wellbeing is quite complex. On one hand it is not very direct and on
the other there are interactions between the broad forces. This, Interaction of
Different Factors („Treatments‟) as threats to construct validity will be checked
and controlled in regression analysis in section V.
Although looking into the details of how each broad factor interacts with each
other is the major concern in development economics research, this is beyond the
scope of this paper. Thus, in the following sub-sections, we will see mainly how
each major broad forces and contributing factors are affecting and/or associated
with child wellbeing. This will be based on theoretical insights, empirical
evidences of previous research work which will be substaintiated by the findings
from my simple statistical and more rigorous econometric analysis of the data of
the last decade.

Determinants of Child Wellbeing in Developing Countries-Lessons from the World Summit for Children
Fig. 7: Schematic framework (Theoretical Construct) of Factors Affecting Child wellbeing in Developing Countries Infilation
Lack of financial
Inappropriate capacity (low
(c) Low level of literacy Low level of purchasing power)
(„Mothers‟) knowledge about childcare High child mortality
practices to cover medical and
appropriate child education cost of
(4)Low level of foreign financial
support & high dept service
care practices children
- Inadequate & -Poor health service

(1)Unhealthy Poor health and (Inadequate health (3)High level of
(macro)
economic Low/ water facilities education, inadequate Malnutrition poverty and
performance: inadequate - Inadequate immunization, lack of inequality
[-low real financial supplies and treatment for sick
GDP per resources logistics for health children, inadequate
capita, service system
maternal care) Low primary Inadequate quantity
for health
-high rate of
- Lack of clean water school and quality of food
inflation, and - Inadequate and is available for
-unfavorable education poor education
enrollment
Lack of access to children
trade service facilities
balance, etc systems. - Inadequate educational services
supplies and
logistics for Destruction of national and household
(2) Misdirected priority in education service socioeconomic system & services, and
budget allocation by directly cost human lives
government
(a) Bad (b) HIV/AIDS and

governance -Low level of civil society and other stakeholders initiatives
and low civil and involvement in community development processes Domestic Conflicts
liberties - Civil un-rest & political instability
Note: 1) Factors written in bold fonts are broad factors (major determinants) while operational mechanisms are presented in normal font
2) Solid lines arrows ( ) indicate how broad factors (major determinants) affect child wellbeing through operational mechanisms; while broken line arrows ( ) indicates
how broad factor (major determinant) affect each other.
Dereje Dejene Engdashet: MA Dissertation UA-IDPM; October 2003 Page 23

4.3 Macroeconomic Performance and Child Wellbeing
4.3.1 The link between macroeconomic performance and child wellbeing
Why some developing countries grow rapidly and others do not is one of the
most compelling questions in Economics (Aziz & Wescott (IMF), 1997), but
development questions like ‗why some developing countries rapidly improve the
wellbeing of their children and others do not‘ is not yet the common debate of
economists.
As defined in a number of literatures, Macroeconomics is the study of economic

behavior in the aggregate. The primary topics to be analyzed in the field of
macroeconomics, accordingly, include: sustainable rates of economic growth, the
employment of resources, stability of prices essential to the proper functioning of a market
economy, and the international linkages that bind individual nations into a world
economy. These topics are all in support of determining the best way to improve
living standards for each person, country, and region around the planet (Douglas
Ruby, 2002).
Lovell C.A. K, et al (1995) defined macroeconomic performance in terms of ‗the

ability of a country's macroeconomic managers to provide four services to their
citizens: a high level of real GDP per capita, a low rate of inflation, a low rate of
unemployment and a favorable trade balance.‟ John Micklewright (2000), in his
article of „Macroeconomics and Data and Children‘, has categorized economic
statistics that enter the macroeconomic debate under five headings. These include:
budgets, interest rates, prices, incomes, and labour markets. Although they
emphasized on the four objectives as the primary performance indicators of
macroeconomic performance, Lovell C.A. K, et al (1995) also indicated that other
economic objectives, such as: the pursuit of an equitable income distribution is
another indicator which comes to mind while assessing macroeconomic
performance. As input to these objectives, macroeconomic managers are
responsible to design polices and appropriate budget allocation for the welfare of
the society.
Stefan deVylder (2000) has argued that macroeconomic polices are rarely
discussed in connection with children, while there is no such things as ‗child-
neutral‘ policies. ―When, for example, monetary polices are discussed, very few
economists and politicians consider their effect on children. But different
categories of people and different age groups are affected quite differently. And
the impact of certain economic polices may not be the same for girls and boys.‖
Stefan deVylder (2000). By the same token macroeconomic performance, in terms
of the different parameters described above, affects different categories of people
and different age groups differently. An empirical study conducted in Peru, to
identify socio-economic groups most vulnerable to welfare declines during a
macroeconomic shocks, depicted that households with more children are among
the more vulnerable groups. (Paul Glewwe and Gillette Hall,1998)
Dereje Dejene Engdashet: MA Dissertation UA-IDPM. October 2003 Page 24

To illustrate the different ways in which economic polices affect the situation of
children, Stefan deVylder (2000) used a set of concentric circles moving outwards
(see fig.-8). The diagram depicts that the hub are polices and legislations which
are closer and explicitly target children, such as the public provision of primary
health care, and primary education. According to Stefan deVylder (2000), while
direct health sector intervention –including preventive action such as vaccination
campaigns – are exceedingly important, and would belong to the inner circle;
(fig.-8 below), sustained declines in infant mortality and improvement in child
health are achieved predominantly through changes in outside factors.
A sustainability study of education projects conducted by the Operation

Evaluation Department (OED) of the World Bank (World Bank (1990), cited in
Daniel Kaufmann and Yan Wang (1995)) reported that the external economic and
policy environment affects sustainability through the fiscal resources the
borrower makes (or does not make) available to support educational
development, or through policy measures to back up specific sub-sectors.
Fi.-8 Children at the Center: Successive Economic Environments that Affect

Child Wellbeing
Source: Stefan deVylder (2000b)-CRIN Newsletter No. 13
Overall, previous studies and country experiences have suggested that project or
sector performance in education and health is associated with the economy-wide
policy environment and macroeconomic performance of a country. The
mechanism, however, through which one is associated with another has yet to be
explored.

In the theoretical construct presented above (fig.-7) we has seen that Unhealthy
(macro) economic performance [low real GDP per capita growth, high rate of
inflation, unfavorable trade balance, etc] make the economy to avail low/
inadequate financial resources for health and education service systems and
subsequently resulted in inadequate & poor health and education facilities,
inadequate supplies and logistics for health and education service, there by poor
health service (Inadequate health education, inadequate immunization, lack of
treatment for sick children, inadequate maternal care), and deprive children to
have access to educational services and finally end up with high child mortality,
high child malnutrition rate and low enrolment rate to primary education
The economy wide policy responsible for unhealthy macroeconomic performance

manifest in terms of macroeconomic parameters: level of real GDP per capita
growth, rate of inflation, rate of unemployment, trade balance, interest rates,
budget allocation and deficits. Of these parameters some are less relevant for
developing countries. For example rate of unemployment. Unlike industrialized
countries, unavailability and unreliability of data in developing countries is made
it difficult and unreliable to measure macroeconomic performance of these
countries in terms of rate of unemployment. Unemployment in most of
developing countries is also disguised as the major occupation is traditional
agriculture and/or informal sector (micro and medium enterprises or income
generating activities.) Trade balance of developing countries mostly covered
through foreign aid/ finance and this disguise its positive or negative effect. Rate
of inflation is more important for developing countries people as they are, in most
cases, living on regular wage or seasonal production. Therefore, I will mainly
concentrate on how real GDP per capita growth rate, and rate of inflation as key
indicator of macroeconomic performance of developing countries affect and/or
associated with child wellbeing, and contributed to the (under) achievement of
the World Summit goals for children. Government budget allocation is handled
separately in the subsequent section (section 4.4)
4.3.2 Economic growth and child wellbeing.
The positive correlation between economic growth and the well-being of children
can be intuitively felt and illustrated by comparing the status of child well-being
of high income countries with that of low incomes. Industrialized countries that
achieved average GNI per capita of US$ 28077 by end of the millennium perform
much better than do poorer countries that able to reach average GNI per capita of
only US$ 290. For example the U5CMR is 6 per 1000 LB in high income countries
vis-à-vis 161 per 1000 LB in poorer countries. Under 5 malnutrition rate (%
underweight) was nil in high income countries vis-à-vis 37 percent in poorer
countries. And NER-primary school was 96 for Industrialized Countries, while it
was 58 for the poorest (least developed) countries.

However, Stefan deVylder (2000) stressed that economic growth is not enough;
the pattern of growth is at least as important as the rate of growth. Moreover,
John Micklewright (2000), indicated that national income per head may be only a
rough guide to the average income of families with children – or that of any other
group. For example the USA has the highest GNP per capita of any large country
but despite this it ranks 12th in a group of 25 industrialized countries in terms of
the proportion of children beneath a common absolute poverty line (Bradbury et
al, 1999, cited in John Micklewright, 2000). Why economic growth not enough?
The 1996 Human Development Report of UNDP, which focused on Economic

growth and human development, identified five patterns of growth which are not
compatible with sustainable human development. These includes
 Job less growth, where the overall economy grows but doesn‘t expand the
opportunity for employment;
 Voiceless growth, where growth in the economy does not be accompanied
by an extension of democracy or empowerment.
 Ruthless growth, where the fruit of economic growth mostly benefit the
rich, leaving the majority of the people struggling in eve-deepening
poverty;
 Rootless growth, which cause people‘s identity to wither; and
 Futureless growth, where the present generation squanders resources
needed by future generation.
The Report (UNDP, 1996) argues that economic growth, if not properly managed,
can be jobless, voiceless, ruthless, rootless and futureless, and thus detrimental to
human development. The quality of growth is therefore as important as its
quantity for poverty reduction, human development and sustainability. Stefan
deVylder (2000) emphasized that ‗for a growth to be truly child beneficial, it needs to
be inclusive, sustainable and equitable‘.
4.3.2.1 Economic growth and the progress in reduction of under five child mortality rate
The following figure (fig.-9) illustrates the association of U5CMR-decade

reduction (1990-2000) with GDP per capita average annual growth rate during the
decade (1990-2000) as well as long term trend of GDP per capita growth rate for
the period of 1960-90. The two variables are tested here from the assumption that
change in the human wellbeing is most probably more affected by long term
economic phenomenon than short term.
From the figure we can sense that there is a sort of positive association between
reduction of U5CMR during the decade (1999-2000) and GDP per capita growth
rate during the same decade as well as long term GDP per capita growth rate
during the pervious three decades (1960-90).

Fig.-9 Scatter plot of Under 5 Mortality rate -Decade reduction (%), 1990-2000 vs.
GDP per capita average annual growth rate (%): (a)1990-2000 and (b) 1960-1990.
60 Malaysia
Oman
Morocco
Korea, Rep. of
Bhutan Chile
40 Brazil Lao PDR
Saudi Arabia Peru
Uruguay
Mongolia
Kyrgyzstan Argentina
Uganda Viet Nam
Ghana China
20 Haiti Gambia
Myanmar
Sudan
Ethiopia
Turkmenistan
Tajikistan Burkina Faso
Sierra Leone Armenia Nigeria
Congo, Dem. Rep. Burundi Mauritania Georgia
0 Zambia
KazakhstanCameroon
South AfCambodia
rica
-20 Kenya
Sw aziland
-40
-10 0 10
GDP per capita average annual growth rate (%) 1990-2000
60 Malaysia
Libya Oman
Morocco Indonesia
Bangladesh Ecuador Korea, Rep.
Iran Philippines
40 Brazil
Bolivia Mexico
Nicaragua Nepal
Thailand
Argentina Dominican R..
India
Ghana Mauritius
20 Benin Gambia China
Niger
Pakistan
Sudan
Lesotho
Mali
Burkina Faso
Nigeria Congo
Af ghanistan
Congo, DR. Burundi
0 Zambia Rw anda
Cameroon
Côte d’Ivoire
South Af rica
-20 Kenya
Sw aziland
-40
-4 -2 0 2 4 6 8
(a) Pearson Correlation (r)=.415 (P<0.01), without correcting for outliers; valid cases=97
(b)Pearson Correlation (r)=.275 (P<0.05), without correcting for outliers; valid cases=77
Source: constructed by the author based on UNICEF - The state of the World‟s Children 2002 and
WDI 2001 data

Although reduction of U5CMR is significantly associated with both the decade

and the long term GDP per capita growth rate, it appears to be that the association
is much stronger with the former than with the latter. Beside the existence of
some outliners, under both circumstances, which are vividly seen on the scatter
plot, the loose association conquers the above argument of UNDP (1996) and
Stefan deVylder (2000).
The close look into countries depicts that out of 68 developing countries that have
achieved, on the average, positive per capita GDP growth rate during the decade,
only 23 countries (34%) have achieved U5CMR reduction of 33% or above. On the
other hand out of 32 DC countries that have faced, on the average, negative or nil
per capita GDP growth rate during the decade, 4 countries (12.5%) have achieved
U5CMR reduction by 33% or above.
When we examine the economic performance of 27 countries developing

countries, where U5CMR increased or made no progress at all, 11 country (41%)
have registered, on the average positive per capita GDP growth rate, and 16 (59%)
have had negative or zero per capita GDP growth rate.
Although reduction of U5CMR (the measures of progress to the submit goal) is

seen to be more associated with GDP per capita growth rate during the decade
than the long term GDP growth rate, the absolute rate of child mortality by the
end of the decade (the year 2000), on the other hand, is relatively more associated
with the long term GDP per capita growth rate (r=-0.436. P<0.01) as compared to
GDP per capita growth rate during the decade (r=-0.395, P<0.01). This implies
that countries that have been economically growing at higher rate during the
pervious three decades have reached at lower U5CMR than countries just
growing during the last decade. As growth is a continuous process and the
current performance is also affected by the momentum of the former decades, we
can see that the difference is negligible.
Overall the correlation coefficients and individual country analysis suggests that
although there is positive association between reduction of U5CMR and GDP per
capita growth rate, it is not necessarily and always true that economic growth is a
perfect panacea that completely overcome U5CMR.
A further look at the association of female-male child mortality rate differences

with GDP per capita average annual growth rate during the decade (1990-2000) as
well as long term trend(1960-1990) shows that there is no association both in
graphical observation as well correlation analysis.

4.3.2.2 Economic growth and prevalence of child malnutrition during the decade
When we look in to how child malnutrition was affected or associated with real
GDP per capita growth rate, from visual observation of the scatter plot as well as
from Pearson and Spearman‘s correlation coefficients (fig.-10), it is found that
there is no association between prevalence of malnutrition (underweight) among
under 5 children and GDP per capita growth rate during the decade (1990-2000)
The only tendency we can get from the Spearman‘s correlation coefficient is for
long term trend of pervious decades (1960-90) and sign of the correlations under
both tests. i.e. there is a tendency for negative correlation: higher economic
growth-lower malnutrition rate, but not consistently significant to generalize as a
phenomenon.
Although few people—whether or not they are nutrition professionals—would

dispute the fact that malnutrition constrains people‘s ability to fulfill their
potential as hungry and undernourished people have less energy to undertake
work, are less able to attend school, and once in school are less able to concentrate
and learn (ACC/SNC, 2002), its irony that under 5 children of the 1990‘s did not
benefit from the economic growth of their countries during the last decade as well
as from long term positive economic growth of the pervious thee decades.
Fig. -10a Scatter plot of percent of Under 5 Under Weight (1995-2000) vs. GDP
per capita average annual growth rate (%): 1990-2000
60 Bangladesh
India
Nepal
50 Ethiopia
Burundi Niger Eritrea
Yemen Myanmar
Lao PDR
40 Pakistan
Madagascar Viet Nam
Congo, DR. Chad Burkina Faso Mozambique
Philippines
Nigeria
30 Indonesia
Sierra Leone Mali
Guatemala
Zambia Uganda
Côte d’Ivoire
Malaysia
20 Uzbekistan
Lesotho
Congo Mauritius
Azerbaijan
Nicaragua China
Kyrgyzstan Egypt Sudan
South Af ricaPanama
10
Kazakhstan
Venezuela Brazil Dominican R..
Armenia Georgia
Argentina Chile
0
-10 0 10
N.B: Pearson r=-.020, and Spearman‟s Rio r= -.064, valid case=95

Source: constructed by the author based on UNICEF - The state of the World‟s Children 2002 and WDI
2001 data

Fig. -10b Scatter plot of percent of Under 5 Under Weight (1995-2000) vs. GDP per
capita average annual growth rate 1960-90
60 Bangladesh
India
Nepal
Af ghanistan
50
Niger Burundi
Myanmar
40 Pakistan
Madagascar
Congo, DR. Burkina Faso
Sri Lanka
Philippines
Papua
Benin New Guinea
30 Indonesia
Mali
Guatemala
Zambia Rw anda Oman
Kenya
Senegal Malaysia
Thailand
20 Lesotho
Iran Ecuador
Nicaragua Zimbabw e Botsw ana
Sudan Egypt China
South Af rica
10 Bolivia Mexico
Brazil
JamaicaCosta Rica
Argentina
Chile
0
-4 -2 0 2 4 6 8 10
N.B: Pearson r=-.208 (p<0.1), and Spearman‟s Rio r= -.231 (P<0.05), valid case=78
2001 data
The following table (table-3), which was constructed by transforming the numeric
value into ordinal taking GDP per capita of 4% and above as high economic growth cut
off point (following Andrian Leftwich (1998) classification to define developmental state),
and underweight prevalence of 10% and less as low prevalence of malnutrition rate,
depicts also that there were no big differences for children to escape the suffering
of malnutrition by being born in the nations of high or modest economic growth.
Out of 63 developing countries where more than 10 percent of its under five
children starved, 43 of them, on the average, have registered positive per capita
GDP growth rate during the decade (1990-2000), while only 20 have experienced
negative per capita GDP growth rate during the same decade. But we can see
from the matrix that countries with negligible (0.1-1.9%) and negative economic
growth tend to fall more in the category of considerable (10-25%) and high (>25%)
malnutrition prevalence rate. This implies that in the countries where the nation‘s
economy has been stagnating or in recession more children have been suffering
from underweight, but in a country where the nation‘s economy were booming
prevalence of underweight did not necessary tend to be low. i.e out of 12
countries experienced high GDP per capita growth rate the proportion of
countries experienced high, moderate and low malnutrition rate is the same
(33%).

Table-3 Prevalence of Under 5 underweight (1995-2000) among countries with different
rate of GDP per capita growth during the decade(1990-2000)
Level of Prevalence of Under-Five Child
Malnutrition (1995-2000)
Level of GDP per capita average Considerable
annual growth rate 1990-2000 Low (1-9%) (10-24%) High (>25%) n
High Growth (4% and above) 33% 33% 33% 12
Modest growth (2.0-3.9) 35% 30% 35% 20
Negligible growth (0.1-1.9) 21% 43% 36% 28
Negative Growth Rate 23% 42% 35% 26
Total 27% 38% 35% 86
n 23 33 30
2001 data
The causality between economic growth and prevalence of under-5 malnutrition

might be debatable. The ACC/SCN (2000) Fourth Report on the World Nutrition
Situation indicated the importance of malnutrition to economic growth. The
report, refereeing to ‗Researchers Estimates‘, depicted that the forgone gross
domestic product (GDP) as a result of iron deficiency alone in childhood and iron,
iodine, and protein- energy malnutrition in adults is tremendous. For example for
Pakistan the annual losses estimated to be over 5% of GDP. For Bangladesh, the
cost of iron deficiency in children alone is nearly 2% of GDP. The ACC/SCN
report also indicated that nutrition and food security also promote economic
growth by reducing the potential for conflict. Although this is a long term effect
of malnutrition on economic growth, in the short run the causality is logically
assumed to be the reverse. If a nation has better economic growth, one may
rationally assume that this nation will provide better quantity and quality of food
for its children. However, from the above analysis we have seen that this does not
seem to be the case. This was probably due to pattern of growth. If growth is
ruthless, as defined in UNDP Human Development Report (1996), it may not be
inclusive and equitable to benefit children as ‘Stefan deVylder (2000) have argued.
Other reason for poor association of economic growth and child nutrition status
might be the influence of other factors indicated in the theoretical framework (fig.-
7). We will see this in more detail in subsequent sections.

4.3.2.3 Economic growth and progress in child primary education
Although achievements of permanent literacy and of basic numeracy are

important ends in themselves for many people, there is a fundamental association
between securing universal primary education and achieving development.
UNESCO‘s Education for All (EFA) Global Monitoring Report (2002) emphasized
that both on the grounds of human rights and of human capabilities, the
development requires that EFA to be attained.
While numerous studies have investigated the impact of human capital

production on economic growth, which is a long term phenomenon, the impact of
economic growth on primary school enrolment is the other side of the loop, the
macro-micro linkage between macroeconomic environment and human capital
production, which completes the vicious circle of education and economic
growth. An examination of country cases also suggests a close relationship
between a country‘s performance in social indicators and its economy-wide policy
environment. Thailand‘s success in raising educational levels, for example, is
associated with the steady economic growth which led to low unemployment
rates (0.8% in 1988) and a surge in demand for better educated labor
(Sussangkam, 1990; World Bank, 1991,1989 cited in Kaufmann and Wang (1995 ).
The figure (fig.-11) (on the following page) illustrates the association of Net
Enrolment Ratio(NER)-primary education at the end of the decade (2000) with
GDP per capita average annual growth rate during the decade (1990-2000) as well
as long term trend of GDP per capita growth rate for the period of 1960-90.
From the figure we can sense that there is a sort of positive association between
NER-Primary-Total by the end of the decade (2000) and GDP per capita growth
rate during the last decade (1990-2000) as well as GDP per capita growth rate over
long term (1960-90). Beside the existence of some outliners under both
circumstances, which are vividly seen on the scatter plot, the loose association
conquers again the above argument of UNDP (1996) and Stefan deVylder (2000).
Moreover, out of 73 developing countries for which data is available, a closer look
into these countries (table-4) depicts that out of 54 nations that have registered, on
the average, positive per capita GDP growth rate during the decade, only 23
countries (less than half) have achieved NER-primary education 90% or more. On
the other hand out of 19 countries that have faced, on the average, negative or nil
per capita GDP growth rate during the decade, 5 countries (26%) have achieved
90% or more Net Enrollment ration of primary education.

Fig.-11 Scatter plot of Net Enrolment Ratio-Primary-Total (2000) vs. GDP per capita
average annual growth rate (%): (a) 1990-2000 and (b) 1960-90
120
Uganda
Argentina
Tajikistan Mexico
Panama Korea, Rep.
Algeria Bolivia
100 Jamaica Mauritius Viet Nam
Philippines Egypt
Kazakhstan South Af rica Chile
Kyrgyzstan Guatemala Thailand Myanmar
Zimbabw eLesotho
80
Lebanon
Nepal
Armenia
Zambia Yemen
Senegal
60 Saudi Arabia Ghana
Burundi Central Af rican R. Mozambique
Tanzania Ethiopia
Eritrea
40 Angola Burkina Faso
Niger
20
-6 -4 -2 0 2 4 6 8
120
Argentina
Mexico
Malaw i Korea, Rep.
Bolivia Malaysia
100 Mauritius
Costa Rica Indonesia
Venezuela ChileColombia
Guatemala Thailand Botsw ana
Nicaragua Zimbabw e Lesotho
80
Iran Nepal
Gambia
Zambia Pakistan
Côte d’Ivoire
Senegal Oman
60 Saudi Arabia
Central Af rican R. Burundi
40 Burkina Faso
Niger
Af ghanistan
20
-4 -2 0 2 4 6 8 10
N.B: (a) Pearson r=.303 (p<0.01), valid case=76 (b) Pearson r= 0.374 (p<0.01), valid case=58
Source: constructed by the author based on UNESCO-data base (2002) and WDI 2001 data.

A further breakdown of the data also depicts that while 90% of the nations that
have enjoyed economic growth rate of 4% and above provided a chance for at
least 70% of their children to be enrolled for primary education. On the other
hand 14% of the nations with meager economic growth (0.1-1.9%) (Burkina Faso,
Eritrea, Guinea, Tanzania), and 10% of the nations with negative economic
growth rate (Angola and Niger) failed to enroll more than 50% of their children
for primary education. Ethiopia, my country, is the only nation in developing
world with reportedly modest economic growth (2.0-3.9%) during the decade that
denied more than 50% of her children the right to get primary education.
Ethiopia is the country known for war, drought, lack of democracy and political
freedom. How these contribute to low NER of primary education and other child
wellbeing parameters in developing countries as whole will be discussed in
subsequent sections.
Table-4. Level of Net Enrolment Ratio-Primary-Total (2000) among countries with

different rate of GDP per capita growth rate during the decade (1990-2000)
Level of Net Enrolment Ratio-Primary-Total
(2000)
Level of GDP per capita average Very Low Low (50- Considerable High
annual growth rate 1990-2000 (<50%) 70%) (70-89%) (>90%) n
High Growth (4% and above) 0.0% 10.0% 30.0% 60.0% 10
Modest growth (2.0-3.9) 6.3% 0.0% 31.3% 62.5% 16
Negligible growth (0.1-1.9) 14.3% 25.0% 35.7% 25.0% 28
Negative Growth Rate 10.5% 42.1% 21.1% 26.3% 19
Total 9.6% 21.9% 30.1% 38.4% 73
n 7 16 22 28
Source: constructed by the author based on UNESCO-data base (2002) and WDI (2001) data.
The negative impact of economic decline on primary education may be vividly

seen in Central and Eastern Europe e.g Armenia and Kyrgyzstan, where GDP per
capita has been declining, on the average, by 3 and 5% during the last decade, and
where NER of primary education was 69 and 82% by the end of the decade
respectively. UNESCO‘s (2002) report also depicted that for some parts of Central
and Eastern Europe, where a rich tradition of education has been threatened by
economic decline and erosion of social capital, the NER is only slightly higher
than the NER of developing countries as a group, while the NER for countries in
transition – encompassing a larger area than Central and Eastern Europe – is even
lower.
4.3.3 Inflation and its effects on child wellbeing
One assumption frequently employed in economic theory is the assumption that

economic agents respond to changes in ``real'' prices, i.e., those prices that have
been purged of their inflation component using an inflation index, such as the
Consumer Price Index (CPI). This economic assumption extends from theoretical
proofs that an individual's utility is unaffected by changes in prices provided that
they experience a commensurate increase in their income.

On the surface, the assumption that individuals respond to ``real'' prices seems
both reasonable and obvious. A number of economist, specially though concerned
with information economics (Greenwald and Stiglitz, 1987, Sanchez,1999, Hunter,
et al, 2001) have argued that in the short run, however, this assumption may not
hold for a variety of reasons. For example, changes in prices and income may not
occur in the same time period. Individuals also may lack sufficient information
about prevailing market information (in this case inflation levels) and/or
experience lags in processing this information and adjusting their behavior
accordingly. These factors may result in a tendency for individuals to base their
economic transactions on nominal (i.e., unadjusted) prices.
As inflation is a negative macroeconomic phenomenon, which erodes the

purchasing power of money over time (Ruby, 2000), fighting inflation during the
last two decades has been the key goal of economic policy mainly in developing
countries. Strong emphasis on reducing inflation is also a common element in
structural adjustment programs, or in what IMF called Enhanced Structural
Adjustment Facility (IMF, 1999)
‗Inflation is bad news,‘ said Guy Debelle et al (1998) of IMF; ―besides distorting
prices, it erodes savings, discourages investment, stimulates capital flight (into
foreign assets, precious metals, or unproductive real estate), inhibits growth,
makes economic planning a nightmare, and, in its extreme form, evokes social
and political unrest.‘
Stefan deVylder (2000) explained how inflation affects different countries,

different social sectors, and different age groups in quite different ways. Among
low income households, especially in poor countries, money to buy or construct a
new house for the family is often raised on the informal credit market- relatives,
friends, local money lenders, etc,. For this reason moderately inflationary policies
tend to have less negative impact on young families with children, who are often
indebted as erosion of their debt through inflation may even be their interest. ‗A
pro-child strategy does not, however, imprudent policies which lead to a high rate
of inflation‘, Stefan deVylder (2000) emphasized. The effects of high inflation on
the distribution of income tend to be most destructive for poorer households as
the rich have greater possibilities than the poor to diversify their asset and
activities as a hedge against inflation.
Stefan deVylder (2000) also indicated that during inflation as well during
administrative interventions to suppress inflation there is tremendous waste of
time and energy, increased information and transaction costs, and rapid
deterioration of social capital. Consequently child-care suffers; children – often
girls - are taken out of school.
Kaufmann and Wang (1995) illustrated the effect of inflation on social services
using Brazil as a typical case. ―Brazil for instance‖, Kaufmann and Wang (1995)
described, ―spends a significant share of its GDP on social services, but its social

welfare indicators are strikingly low with infant mortality of 58 per 1,000 live
births in 1991‖. According to Kaufmann and Wang (1995) inflation and poor
expenditure policies that resulted in stop-and-go financing, and price distortions
induced by government regulations are some of the contributing factors. Jane
Falkingham (2000) also reported ‗rapid inflation‘, as one of the several factors that
contributed to the reduction of the resources available to households and
increased the risk of child poverty in countries under economic transition.
As it was illustrated in the schematic diagram of theoretical construct (fig.-7) on

page 19, inflation is presumed to be influencing the wellbeing of children in two
ways: by affecting the real value of the resources available from government and
donors for health and education service systems, on one hand, and by affecting
financial capacity (purchasing power) of families to cover medical and education
cost of children on the other hand.
The descriptive analysis of average annual inflation rates of 99 developing

countries, for which data is available, depicts that the average annual inflation
rate during the decade (1990-99) ranged from -2.9% in Oman (Middle East) to
1,423.10% in Costa Rica (Latin America and Caribbean), followed by Angola
(924.3%), Ghana (709.3%) in SSA; Turkmenistan (663.4%), Uzbekistan (356.7%)
and Armenia (349.1) in CEE/CIS and the Baltic States region. Beside Oman,
countries with very low inflation rate during the decade include Jordan (0.2%)
and Saudi Arabia (1.4%) in the Middle East; Gambia (0.8%) and Gabon (1.7%) in
the SSA. The mean average annual inflation rate of 99 developing countries was
74.4 (with Sd: 202.7) while the median was 10.1 with an inter-quartile range of
26.4.
The comparison of courtiers that have average annual inflation rate of 10% or less
(i.e less than a Median value) ‗vis-à-vis‘ countries with two digit inflation (above
the median value)7, is presented in table-5. The table illustrates that ‗countries
with two digits (or more) inflation rate‘ were performing poorly in most of child
wellbeing parameters during the decade. Where annual average inflation rate
was less than 10% -U5CMR was reduced by 20.1%, while the group countries with
two digits or more annual average inflation rate reduced U5CMR only by 13.1%.
The difference between the two groups of countries with regards to the absolute
level of under-5 mortality rate recorded by the end of the decade is also quite high
(82.9 vs 109.3). Without introducing other controls these two association can be
considered as a statistically significant at p=10%.
Although statistically not significant and testing the differences with and without
the outliers are nearly the same in statistical terms; female-male difference in child
mortality rate between these two groups of countries is an issue which also
attracts attention. U5CMR Female-Male difference of 0.6 vs 2.6, for low inflation
7 In such a situation where variability is too high, the statistical literatures advice to use the Median as
measure of central tendency, as the Mean is obviously affected by extreme values.

and double digits inflation group respectively, is not something which has to be
disregarded because of the absence of statistical significance. The discriminatory
effect of inflation can be attributed to the way it operates. It affects the financial
capacity (purchasing power) of families to cover medical and education cost of
children, and the force families to discriminate against the female child due to
tradition.
As we can see from the table (table -5), there is no considerable difference between
the two groups of countries with single digit and double/triple digits inflation
rates with regards prevalence of malnutrition (% of under-fives underweight),
NER-Primary Education- Total, and NER-Primary Education- Female. However,
there is significant difference in terms of the rate of progress during the decade in
NER both total and for female. In countries belongs to the group with two/triple
digits rate of inflation, change in total and female NER were lower than that of the
group of countries with single digit rate of inflation by 8.1% and 9.1%
respectively. This association is statistically significant at p=5% without
introducing other controls. Thus we will see in section V if this association
consistently reveals itself when other factors come in as explanatory and/or
control variables.
Table-5. Comparison of progress in child wellbeing indicators among countries with

different rates of inflation during the decade (1990-2000)
Level of Annual t8
Avg. Rate of Std. (Equal
Dependent Inflation Error Mean Variance
Variables (1990-99) N Mean Mean Difference Assumed)
Under-5 mortality <=10% 48 82.9 10.1
rate 2000 Greater than 10% 52 109.3 9.8 26.4 -1.9+
<=10% 48 20.1 2.6
U5CMR -Decade
reduction (%):
1990-2000 Greater than 10% 49 13.1 2.7 -7.0 1.9+
Female- male <=10% 32 0.6 1.2
difference in
U5CMR1988-98 Greater than 10% 27 2.6 1.3 2.0 0.7
% of under-5 <=10% 47 20.5 2.0
underweight
(1995-2000) Greater than 10% 50 20.7 1.8 0.2 -0.1
NER-Primary <=10% 37 80.8 3.2
Total (2000) Greater than 10% 37 79.8 2.9 -1.0 0.2
NER- Primary <=10% 37 78.7 3.6
Female (2000) Greater than 10% 37 78.2 3.1 -0.4 0.1
Change in total <=10% 30 10.5 3.0
NER(1990-2000) Greater than 10% 26 2.4 2.6 -8.1 2.0*
Change in Female <=10% 27 12.8 3.5
2.0*
NER(1990-2000) Greater than 10% 22 3.6 2.6 -9.1
Source: Calculated by the Author from UNICEF (2002), UNESCO (2002) and WDI (2001) data base.
8 Levene's Test for Equality of Variances depicts that there is no significant difference between variances of
the paired mean for all variables, thus values of t-test for equal variance were used for test significance.

4.4 Government budget allocation and child wellbeing
"The well-being of children requires political action at the highest level. We are
determined to take that action." Declaration of the World Summit for Children, 1990
4.4.1 The link between government budget and child wellbeing

The effect of government expenditure on aggregate economic activity is a subject
with a long and controversial history, and it is beyond the scope of this paper.
Thus one might ask: What is the link between the state budget and children? Is it
possible to know the budget allocated for children and measure the association
between government budget and child wellbeing?
Directly or indirectly, almost all Articles of the Convention on the Right of the
Child (CRC) entails an economic obligation for the public sector. And the budget
reflects a country's socio-economic policy priorities and commitment for the
policy (deVylder(2000), Robinson (1998)). As the most important economic
instrument of the government, government budget translates policies and
political platforms into expenditures and taxations, emphasizing constraints and
trade-offs in policy choices (Robinson, 1998). The key general article with regards
to resource implication of the CRC is Article 4 that reads as follows:
“States Parties shall undertake all appropriate legislative, administrative, and other
measures for the implementation of the rights recognized in the present Convention.
With regard to economic, social and cultural rights, States Parties shall undertake such
measures to the maximum extent of their available resources and, where needed, within
the framework of international co-operation.”
Kofi Annan, United Nations Secretary-General in his end-decade review report

(2001) of the World Submit for children expressed the inadequacy of state budgets
to meet the needs and fulfilling the rights of children in the following statements.
―The world has fallen short of achieving most of the goals of the World Summit for
Children, not because they were too ambitious or were technically beyond reach. It has
fallen short largely because of insufficient investments. Compared to what the world
spends on armaments or luxury consumer items, the resources needed to provide for the
basic needs of children are modest and affordable. Even with limited support, even the
poorest countries of the world can afford to underwrite basic social services. Yet the
missing ingredient is often not so much resources as an absence of vision, misplaced
priorities and insufficiently committed leaders‖
Shirley Robinson (1998) argued that budgetary programmes, specifically socio-

economic expenditures, affect the wellbeing and life opportunities of children
directly. Yet, children do not form a powerful political lobby, and cannot advocate
for themselves, for more effective delivery of socio-economic services that meet
their needs. The policy implication is that the lack of a detailed assessment of
what government is spending on children inhibits the effective improvement of
basic living standards of children.

Despite the importance, there are limited empirical studies conducted so far in
developing countries to establish the effect of the state budget allocation on child
wellbeing. The pioneer work of Cornia et al (1987), in their article ‗Adjustment
with Human Face‘- published by UNICEF, revealed that indiscriminate cuts in
government health expenditure, which was often part of adjustment programs,
leads to declines in the health status of the population. Cornia et al (1987)
mentioned that delay in immunization and outbreak of deadly diseases among
children in the Sào Paulo State of Brazil; and increased incidence of infectious
diseases and disease specific mortality in Ghana- happened as a consequence of
budget cuts in primary health expenditure. Kaufmann and Wang (1995) also
reported that misallocation of resources within and across sectors is one of the
contributing factors for strikingly low social welfare indicators of Brazil. Recently
(in 2001) Save the Children Sweden launched ―a pilot child-focused budget
study‖ in a few countries (Save the Children Sweden and Tiruneh Sinnshew, 2000),
with the aim of making children more visible in policies and decision-making
related to budget and resource allocation and to advocate that children be given
serious consideration in such policy decision making processes.
However, all this studies have not established consistent and significant
association of state budget and child wellbeing indicators in developing countries
as whole and over a period of time. Shaamela Cassiem et al (2001) argued that
government policies, spending initiatives and service delivery are not the only
things that affect child wellbeing. ―If there was a fall in the child mortality rate in
the wake of an increase in government spending on a particularly health service
program, it could not be concluded with absolute certainty that the improved
outcome was due to government‘s actions.‖ Moreover comparison of budget rises
and cuts vis-à-vis public health indicators of limited countries will not provide
conclusive information. Therefore, assessing the effect of state budgets on child
wellbeing over the decade for developing countries as a whole is an added value
to the existing knowledge.
In order to assess the link between the state budget and children, Stefan deVylder
(2000) highlighted the importance of beginning with a macro-analysis of budget
expenditure and revenues; and identifying major priorities and trends in
expenditure patterns as the key to budgetary analysis. Some scholars emphasized
the need to breakdown government budgets into estimates of the proportion
devoted to children (Robinson and Biersteker (1997), cited in Micklewright (2000))
However, as disaggregated data are not clearly identified with a particular group,
estimation of budgets particularly devoted for children is nearly impossible.
Moreover, the benefits of expenditures on pure "public goods" are impossible, by
definition9, to divide between particular groups in the population.
9. In economics, a public good is some economic good which possesses two properties: It is non-rivalrous,
meaning that it does not exhibit scarcity, and that once it has been produced, everyone can benefit from it. It
is non-excludable, meaning that once it has been created, it is impossible to prevent people from gaining
access to the good (Wikipedia, on-line encyclopaedia; http://www.wikipedia.org/wiki/Public_good )

In the absence of child specific budget/ expenditure data, the commitment of any
government to the convention is, therefore, reflected in the state budget allocated
to health and education sectors. Most of the resources related to child rights are,
of course, directly connected with the provision of services, mainly in the area of
education and health. Here we have to look into relative budget allocations and
cross country comparison of effect of the budget allocation for the three sectors
(health, education, and defense) on child wellbeing indicators. Defense is
included here, because it is not only a good indication for which the government
is committed more, but also the budget allocated for defense is believed to be at
the expense of meeting the needs and fulfilling the rights of children and other
social development programmes.
4.4.2 Effect of government budget allocation on child wellbeing
Table-6 Descriptive Statistics of central government expenditures allocation of

developing countries for Health, Education and Defense during the decade
(1990-2000)
Percent of
central
government Mean Median Minimum Maximum Percentile Percentile Valid
expenditure 25 75 N
allocated to
Health 6.2 6 1 23 3 8 83
Education 14.6 15 2 31 10 20 84
Health &
Education
Total 20.9 22 3 41 15 28 83
Defense 11.4 8 1 36 5 15 79
Source: Calculated by the Author from UNICEF (2002) and WDI (2001) data base.
From the above table we can easily see that there is wide variation in the
allocation of government expenditure for health, education and defense. The
expenditure for health and education, all together, ranges from as low as 3%
(Pakistan) to 41% (Costa Rica). Beside Pakistan, out of 83 countries for which data
is available, states that refused to allocate at least 10% of their budget for health
and education includes India (from South Asia), Indonesia (from East Asia and
the Pacific region), Azerbaijan, Tajikistan, Georgia, Kazakhstan (from CEE/CIS
and Baltic States region), Guinea and Nigeria (from SSA), Lebanon (from the
Middle East), and Argentina (from Latin America). On the other hand only about
50% of the states have allocated about 20% of their annual expenditure for health
and education, which was the commitment when the Summit was launched. It
appears that most of the developing countries (more than 75% of them) were
allocating very small fractions of their expenditures for health sector. Out of 83
countries only 15 have allocated more than 10% of their annual expenditure for
health. They were mainly from Latin America and Caribbean region, which
includes Cuba, Costa Rica, Panama, Nicaragua, Chile, Dominican Rep.,

Guatemala, Ecuador, Honduras, and Venezuela. Three more were from SSA
(Zambia, Sierra Leone and Namibia) and only one from the Middle East (Jordan)
and one from South Asia ( Bhutan).
Although education seems relatively more favored by the government of

developing countries, 25% of the 84 countries were seen allocating less than 10%
of their expenditure for education.
Analysis of the correlation between child wellbeing indicators and percent of

government expenditures allocation for the three sectors (Health, Education, and
Defense) is presented in the following table (table-7). The table depicts that there
is negative and significant correlation between prevalence of malnutrition (% of
under-fives children underweight (1995-2000)), and U5CMR by the year 2000 vis-
à-vis percent of central government expenditure allocated to health. This means
governments that were willing to commit enough resources managed to keep the
U5CMR and malnutrition rates to lower levels as compared to those denied their
nations adequate budget allocation.
The absence of any significant correlation between central government

expenditure allocated to education and child wellbeing indicators (as also
depicted in table-7) is something not expected, but it is not unbelievable.
Technically factors affecting child education are categorized into two major
factors: in-school factors and out of-school factors10. One of the reasons, therefore,
could be inadequate allocation for primary education to improve in-school
factors. The disaggregated data collected by UNESCO (2002) from 42 developing
countries indicates that, on the average, only 43% of total educational expenditure
went to Primary Educational expenditure during 1998-2000. The variability of
allocation for Primary Educational expenditure is much higher as compared to
total educational expenditure. It goes from as low as 1.2% in Kenya followed by
El-Salvador (13%)- to- as high as 69% in Cambodia followed by Papua New
Guinea (65.50%) and Benin (63.20%). The other reason could be the problem of
out of school factors. The best example is a lesson from Malawi, where lifting
school fees and school uniforms, as a requirement to come to school, resulted in
overnight swelling of schools (The Economist- Feb.1995, cited by Stefan deVylder,
2000.)
Some of the important features of table-7 are as follows. There is significant

positive correlation of ‗central government expenditure allocated to defense‘ with
‗female-male difference in child mortality rate‘, and ‗prevalence of malnutrition
rate‘ (measured in % under-fives underweight). Moreover, central government
expenditure allocated to defense significantly but negatively correlated with
‗NER- primary education–total‘, and ‗female NER-in primary education‘.
10
Briefly, in-school factors include availability of adequate class-rooms, furniture, school supplies, and
trained teachers; while out-of-school factors include family welfare and income to cover school uniform and
stationeries, distance to school, and most importantly willingness of the family to send the children to school
instead of keeping them at home as child is important economic asset in most rural area of developing
countries.

One can attribute the significant correlation of higher defense budget and higher
female child mortality as compared to male child, to cultural preference. In a
warier society, where male are traditionally the major participants, there is always
Table-7 Correlation matrix of Child wellbeing indicators vs. central government

expenditures allocation for Health, Education and Defense during the decade
(1990-2000) in developing countries
% of central % of central % of central
government government government
expenditure expenditure expenditure
Indicators of Child allocated to allocated to allocated to
Wellbeing Health Education Defense
r -0.2+ -0.08 0.14
Under-5 mortality rate 2000 N 83 84 79
Under 5 Mortality Rate -decade r 0.07 0.02 -0.06
reduction(%) 1990-2000 N 83 84 79
Child mortality rate female- r -0.19 0.01 0.37*
Male difference 1988-98 N 51 52 51
Under-fives underweight (%), r -0.25* -0.07 0.23*
1995-2000 N 79 80 75
Net Enrolment Ratio-Primary: r -0.06 0.03 -0.22+
Total (2000) N 66 66 62
Net Enrolment Ratio in Primary r -0.02 0.05 -0.25*
school- Female (2000) N 66 66 62
Progress in Net Enrolment Ratio r 0.08 -0.07 -0.05
total (1990/91-2000/01 N 66 66 62
*Correlation is significant at 5% level, and + at 10% level (all 2-tailed).
r= Spearman's rho correlation coefficient; N= Number of Valid Cases (countries) in the bivariate.
Source: Calculated by the Author from UNESCO (2002), UNICEF (2002) and WDI (2001) data
base
a preference for the male child. This preference results in discrimination of female
children in food as well as in medication. The significant positive correlation of
central government expenditures allocated to defense with the malnutrition rate is
a good example of how governments of developing countries are militarizing at
the expense of children. In a country where government is investing more on
defense, for example Ethiopia in the 1980s and part of the 1990s, there has been
forced contribution in cash and in-kind by the rural poor to support the
militarization, although they did not have enough to feed their children.
Moreover, mobilization of productive labor force for the military left the rural
community with women and unproductive men, and consequently less food to
feed the children. Allocation of more budgets for defense also significantly
affected primary education, especially that of female children. Overall, we can say
that the more budget is allocated by the central government of developing
countries for defense the more child wellbeing is getting worse.

The ‗Test for equality of Means‘ in child wellbeing indicators among countries
with different level of central government expenditure allocated for health during
the decade (table -8) also depicts that countries that allocated at least 10% of their
central government budget for health have significantly performed better than the
others in lowering absolute levels of child mortality rates, progressing towards
the Summit goal of reducing child mortality by 33%, and in reducing prevalence
of malnutrition as measured by the percent of under-fives underweight.
Table-8. Test for equality of Means in child wellbeing indicators among countries with
different level of central government expenditure allocated for Health during
the decade (1990-2000)
Level of central
govt. expenditure Std.
Dependent allocated for Error Mean t 11
Variables Health N Mean Mean Difference
>= 10% 10 46.2 7.9
U5CMR- 2000 < 10% 65 94.5 8.4 -48.34 -4.19**
U5CMR -Decade >= 10.00 10 29.8 3.1
reduction (%)
1990-2000 < 10.00 65 18.7 2.3 11.06 2.83**
U5CMR female- >= 10.00 7 0.6 0.9
Male difference
1988-98 < 10.00 41 -0.1 1.1 0.67 0.25
% of under-fives >= 10.00 10 13.7 3.0
underweight (1995-
2000) < 10.00 62 21.6 1.7 -7.93 -1.84+
N.B: **Significant at 0.01; *significant at 0.05; and +significant at 0.1 level of significance
Source: Calculated by the Author from UNESCO (2002), UNICEF (2002) and WDI (2001) data base
11 Levene's Test for Equality of Variances depicts that there is significant difference between variances of
the paired means for Under-5 mortality rate 2000 and U5CMR -decade reduction. Thus, the test for these
variables is based on t-value of unequal variance.

4.5 Foreign aid/ finance and child wellbeing
„More effective development means improvements in the lives of hundreds of

millions of people: more food on the table, healthier babies, more children in school.
These are things worth fighting for-and if properly managed foreign aid can make a
big contribution‟ Joseph Stiglitz (1998)
4.5.1 Overview of the need and status of foreign aid during the decade
In many developing countries, resources devoted to basic social services such as
health, education and public investment are supplemented from a wide variety of
sources. Among the major sources foreign finances in the form of Development
Aid, and private capital flows are the most conspicuous. Development Aid-
formally called Official Development Assistance (ODA) encompasses loans on
concessional terms, technical assistance, and outright grants plus grants from
private voluntary organizations (NGOs) (DAC, 2002)
Due to the fact that many developing countries, particularly the least developed
and the most indebted ones, will need substantial international co-operation to
enable them to participate effectively in the world-wide effort for child survival,
protection and development; all international development agencies-
multilaterals, bilaterals and non-governmentals - were urged, on the launching of
the Summit, to examine how they could contribute to the achievement of the
Goals of the Declaration as part of more general attention to human development
in the 1990s. The international communities, including private-sector creditors,
are urged to work with developing countries and relevant agencies to support
debt relief for children. To match increased efforts by developing countries
themselves, the donor countries and international institutions were asked to
consider targeting more development assistance to primary health care, basic
education, low-cost water and sanitation programs and other interventions
specifically endorsed in the Summit Declaration and the Plan of Action (World
summit for children 1990).
The End-decade Review Report of UN Secretary General (Kofi Annan, 2001)

reveals that the amount of donors‘ contributions fell far short of the minimum
necessary to meet the most pressing needs of children in such areas as primary
health care, nutrition, basic education, safe water and adequate sanitation. Kofi
Annan stressed lack of commitment and insufficient contributions of donors as
one of the causes for failing to meet the needs and fulfilling the right of the
World‘s children.
The statistics of the Development Co-operation Report of the OECD/DAC (2002)

reveals that donor countries did not respond with an increase in aid flows. The
Net Official Development Assistance (ODA) rather dropped substantially over the
decade by about 20 percent in real terms and aid levels expressed as a share of
donors‘ GNP fell even more sharply—from 0.33 percent in 1990/91 to 0.22 percent

in 2000/01. Of course there were variations among DAC countries. In 1990/91,

net ODA expressed as a share of donors‘ GNP12 was ranging from 0.17 percent
(Ireland) to 1.15 percent (Norway). While in 2000 it was ranging from 0.10
percent (United States of America) to 1.06 percent (Denmark). Of the 22 DAC
member donor countries, countries that have increased their aid level in terms of
the share of their GNP are Denmark, Ireland, Luxemburg, New Zealand,
Switzerland and United Kingdom. The only countries that kept the promise of
contributing at least 0.7 percent of their GNP include Denmark, Luxemburg,
Netherlands, Norway and Sweden.
In the decade, when the cold war was put to an end, economy (GNP) of the donor
countries grew on the average by about 2 percent per annum, and average annual
inflation rate was below 3 percent except for Italy, Portugal and Spain (where it
ranged between 4 to 6 percent), ODA, expressed as a share of donors‘ GNP,
should have been higher. The only unfavorable economic phenomenon seen in
DAC countries was unemployment rate, which has increased in almost all
countries. But this was exceptionally the reverse for USA― the largest economy of
the world and also the largest donor of the world in absolute dollar value until
1990/91. In USA unemployment rate became less than 5 percent as compared to
7.1 percent in 1980s. Where as Denmark, where unemployment rate dropped
from 7 to about 5.4 percent, increased its ODA as share of its GNP from 0.95
percent in 1990/91 to 1.06 in 2000.
In most DAC countries, however, the unemployment rate didn‘t considerably

exceed 10 percent, except for Finland (14.4%) and d Spain (20.6 %). So what made
ODA the victim of donor countries economic managers‘ ax?
 Was it due to the change in the philosophy of aid OR due to global political
changes― end of cold war?
 Was it due to the fact that aid already had done enough to crowd-in private
flows and to worries that more extra aid would crowd-out private flows
OR recipient countries economies failed to sustain debt service?
 Was it due to that fact that aid had done enough to change the dismal
socioeconomic situations of recipient countries OR due to ineffectiveness of
aid to bring about considerable change in the lives of the people in
developing countries?
These and other related questions are wide and debatable issues, which has been
under debate for the last three decades. Going into the details of each is beyond
the scope of this paper. I will briefly review these issues before going into the
analysis of what effect foreign finance most likely brought on child wellbeing
during the decade.
12
Data for Greece in the year 1990/91 is missing.

4.5.2 The philosophy and interests behind aid
The World Bank Policy Research Report (1998) described that from the start,
foreign aid, had twin objectives, which were potentially in conflict. The first
objective was to promote long–term growth and poverty reduction in developing
countries. The underlying motivation of donors in line with this objective was a
combination of altruism and a more self interested concern that, in the long term
their economic and political security would benefit if poor countries were
growing. The second objective was to promote short term political and strategic
interest of donors (World Bank, 1998.)
These mixed objectives were clearly reflected in conditionalities attached to aid.

Even if a donor is only motivated by genuine altruistic world view, and the sole
objective is to further development in the recipient country, it is very likely to see
that a number of conditions imposed and aid is tied by donor(s)13. For example
the statistics on aid reveals that in 1993― 44%, in 1998― 28% and in 2001 about
18% of ODA from DAC countries had been fully tied (WDI, 2001; OECD, 2002.)
By 2001 the only country that had untied 100 percent of its ODA was Ireland,
followed by Norway (98.9%) and Switzerland (96.1%), while the highest level of
tied aid was noticed in Italy (92.2%) followed by Greece (82.7%) and Canada
(68.3%). By definition, aid conditions and/or tying are donor-initiated policies or
mechanisms intended to ensure that resources from donors, and related resources
provided by developing country partners, are used as the donor intended, which
were common in project funding. The structural adjustment lending by the
Britton Woods institutions (World Bank and IMF) is another form of
conditionality at macro-economic level 14 . But one may ask whether this was to the
benefit of recipients?
The Reality of Aid Report (2002) highlighted the substantial links between the
practices of imposing policy and project conditionalities, through which donors
exercise their power, and the impact of these policies on inequality and increasing
poverty. The report emphasized that Official Development Assistance (ODA),
particularly for the poorest countries, should be a critical resource for
implementing strategies to overcome poverty. Yet what has been witnessed and
documented over the past decade is a widening gulf between donor policy
rhetoric and the actual purposes, practices and consequences of donor
programmes as experienced in the South. In the 1990s, aid conditions expanded
both in scope and ambition, not only to influence macro-economic policy, but also
to micro-manage a wide range of developing country policies and institutions.
According to the Realty of Aid Report (2002) the evolution of the debt crisis
emante from massive multilateral and bilateral àid loans' tied to debt repayments
and structural adjustment policies. These loans and policies were in fact pressed
upon developing country governments by hundreds of missions led by
13
Renard, R. Structural Adjustment and Aid Polices: Lecture note –for Academic Year 2002-2003;
University of Antwerp, Institute of Development Policy and Management.

IMF/World Bank experts, so that they might service their debts to Northern
creditors at the expense of meeting extreme and expanding social needs.
Conditionality imposed by donors (bilateral and IFIs) and debt crisis had also
multiplier effect (negative externalities) on the socioeconomic performance of
developing countries. “Not only do the poorest countries remain burdened by debt”, the
Reality of Aid Report emphasized, ―they are also increasingly exposed to financial
instability in a globalised market pushed by the name of Washington Consensus whose
rules favour rich countries and corporations.‖
Now, the question is how one can attribute whether aid is a resource transferred
to developing countries to foster socioeconomic development if geopolitical
considerations and other factors played major roles?
Contrary to the Reality of Aid Report, Jakob Svensson (2000) argued that tied
project aid and delegation of part of the aid budget to an international agency
with less aversion to poverty improve welfare of the poor in the recipient
countries. By applying contract theory, Azam and Laffont (2003), have analyzed
foreign aid as a contract- where the North gives a transfer to the South in return
for poverty reduction, regarded as an international public good. They support the
importance for a donor to impose optimal conditions to its aid flows to redress an
inequitable allocation of supports among the poor, when the recipient
government is prone to favoritism (e.g. urban poor better supported than rural
poor, or ethno-regional problems, etc.). They argue that governments in the
South may have different preferences towards the poor, and this information is
not necessarily common knowledge. And a more troublesome commitment
problem comes from the South‘s taking the aid money and not delivering the
agreed-upon consumption to the poor. To avoid such a behavior it would be
enough to disburse aid only after observing (every year, every month if
necessary) the consumption of the poor.
The recent report of World Bank (2002) highlighted that during the Cold War,
factors unrelated to poverty were especially important in driving aid allocations
that let aid flows into the regimes that were political allies of major Western
powers. But, since the end of the Cold War, and increasingly through the 1990s,
donor countries and other aid agencies have reallocated assistance in ways that
strengthened poverty reduction. The evidence emphasized by the World Bank
Report (2002) is what summarized in the following estimate of aid flows:- ‗By
1997–98, good-policy countries received $28 per capita, in net disbursements, or almost
twice as much as the poor-policy countries ($16.4 per capita)‘
Given this disagreement, let us proceed to other aspect of foreign finance with the
assumption that aid can have some positive and/or negative effect on child
wellbeing depending on weight of aid objectives and level of influence of other
factors indicated in theoretical frame work.

4.5.3 Foreign aid and private capital flows to developing countries
According to World Bank (1998), in the 1990s three events have lowered the
absolute and relative importance of foreign aid: 1) fiscal problems in OECD
countries, 2) the end of the Cold War, and 3) the dramatic growth in private
capital flows to developing countries. As we have seen the first two factors, more
or less, let us look into the flow of aid and private capital to developing countries.
Fig.-12. The Total Net Flow of Long-Term Financial Resources from DAC Countries to
Developing Countries and Multilateral Organizations by Type of Flow in Millions of
US$ (2000 price)14
140 000
Private Flows at market
terms
120 000
Official Development
Assistance
100 000 Other Official Flows

Billion US $ (2000 price)
80 000 Net grants by NGOs
60 000
40 000
20 000
1985-1986 1990-1991 1997 1998 1999 2000 2001

average average
-20 000
Source: Graph constructed by the Author from the statistics of Development Co-operation Report of OECD/DAC (2002)
A very vivid observation from the above figure is that in the 1990s there has been
a tremendous increase in the private capital flows to developing countries.
However private capital flows seems volatile. After reaching more than US$ 125
billion (more than twice of ODA) in 1996/97, it started declining and it became
less than US$ 50 billion by the beginning of the millennium. This was reportedly
due, mainly, to financial crises in East Asia in late 1990s, and the September 11
crisis in 2000.
The aggregate picture we see above, of course, hides the distribution of Private
capital flows, which is solely motivated for profit, not by altruistic values, except
in a very special circumstances or attachment to specific countries like the
MIDROC15 group in Ethiopia. According to World Bank (1998) private capital
flows are heavily concentrated in a few countries, and will continue to go to a
14
Contribution to multilateral institutions was 28% in 1990/91 and about 33% onwards
15
MIDROC group is a Saudi Arabia based conglomerate of companies owned by Saudi-Ethiopian business
tycoon -Sheik Mohammed Hussein Al-Amoudi. MIDROC group started investing in Ethiopia, since 1990;
motivated by belief in Ethiopia‘s ―immense potential‖ and attachment due to birth. The group, comprising
more than 30 companies, is Ethiopia‘s largest investor and biggest employer. More than 60,000 workers
and their families depend on the employment it provides (Press Net June 9, 2003 issue: http://www.pressnet-
dc.com/ethiopia/invesm.asp)

small number of (mostly) middle-income countries. In 1996, 26 countries received

95 percent of private investment; only the rest 5 percent went to the other 140
developing countries. The argument that aid has already done enough to crowd-
in private capital flows and more extra aid will crowd-out private flows, is thus,
invalid.
The inability of recipient countries economy to sustain debt service may be a

logical and valid argument. During the decade, the debt burden measured in
terms of outstanding loan stock (EDT) of most developing countries reached more
than 50 percent of GNI and Total Debt Service (TDS) was about 20 percent of
export earnings from goods and services (Dereje Dejene, 2003). Therefore we will
consider the three dimensions (ODA, Private Capital flows and Debt service) in
the analysis of the effect of foreign aid/finance on child wellbeing.
4.5.4 Effectiveness of aid in developing countries-review of literatures
“The problem of making poor countries rich was much more difficult than we
thought‖ William Easterly (2001)
The argument of effectiveness of aid for economic growth goes back to Chenery
and Strout statement of ‗Aid will fill the temporary gap between investment
ability and saving ability‘ (Strout, 1966; cited in Easterly, 1999.) „This statement of
Strout‟, Easterly (199) commented, ‗derived based on the Harrod –Domar model of
ICOR formulation to determine investment requirements for a given growth target.‟
Prior to 1990, aid effectiveness studies have been mainly focused on the micro
(project) level. As many successful projects were leaving no lasting imprint on
economy wide growth rates, the study shifted to macro level effectiveness of aid
(Thorbecke, 2000).
In recent years, there have been also quite a number studies and publications on
aid effectiveness. Boone (1996) Burnside and Dollar (2000), Collier and Dollar
(2001, 2002), Easterly (1999, 2001), Hansen and Tarp (2001), Hillman (2002), IMF
(1998), Kosack (2003), Langhammer (2002), Nunnenkamp (2002), World Bank
(1998, 2002) are among the major publications based on cross-country studies.
The Reality of Aid- An Independent Review of Poverty Reduction and
Development Assistance- is special annual publications (Report) since 1993 by a
consortium of NGOs.
Because the methods employed to study the subject range from country case
studies to regression analyses of samples of almost a hundreds of countries, the
analyses have generally seen to yield different results. We will briefly look into
some of the key issues and findings in the following paragraphs.
After analyzing aid effectiveness as related to political regimes, Boone (1996),

argued that aid doesn‘t significantly increase investment, nor does benefit the
poor as measured by improvements in human development indicators. It rather

increases the size of the government. The impact does not vary whether recipient
governments are liberal democratic or highly repressive. The only difference in
Boone‘s (1996) findings was that infant mortality rate in liberal democratic
regimes were on the average lower by 30% than in the least free regimes. Boone
said, ‗This is probably due to empowerment of the poor liberal democratic
regimes.‘
The consecutive study paper published by the World Bank: ‗Assessing Aid: What
Works, What Doesn‘t, and Why‘ (1998) and ‗The Role and Effectiveness of
Development Assistance: Lessons from World Bank Experience‘ (2002) take a
broad view of the relationship between development experience and official
development assistance (ODA) over the past 50 years. The key statement in the
first report to explain the effectiveness and failure of foreign aid reads as follows:
―Foreign aid in different times and different places has been highly effective, totally
ineffective, and everything in between.‖ The World Bank provided a lot of evidences
for this statement.
Foreign aid played a significant role in each transformation, contributing ideas

about development policy, training for public policymakers, and finance to
support reforms and an expansion of public services. Foreign aid has also
transformed entire sectors. The agricultural innovations, investments, and policies
that created the Green Revolution—improving the lives of millions of poor people
around the world—were financed, supported, and disseminated through alliances
of bilateral and multilateral donors. Internationally funded and coordinated
programs have dramatically reduced such diseases as river blindness and vastly
expanded immunization against key childhood diseases. Hundreds of millions of
people have had their lives touched, if not transformed, by access to schools, clean
water, sanitation, electric power, health clinics, roads, and irrigation—all financed
by foreign aid (World Bank, 1998.)
‗On the flip side‘, the report emphasized, ‗foreign aid has also been, at times, an
unmitigated failure. A steady flow of aid ignored, if not encouraged,
incompetence, corruption, and misguided polices in some countries.‘
Contrasting to Boone (1996), although not quite contrary, the basic findings and
main emphasis of the paper is the fundamental role of good policy environment
and sound economic management for financial aid to works. The report depicts
that financial assistance leads to faster growth, poverty reduction, and gains in
social indicators in developing countries with sound economic management.
―With sound country management, 1 percent of GDP in assistance translates into a 1
percent decline in poverty and a similar decline in infant mortality. In a weak
environment, however, money has much less impact. A $10 billion increase in aid would
lift 25 million people a year out of poverty—but only if it favors countries with sound
economic management. By contrast, an across-the board increase of $10 billion would lift
only 7 million people out of their hand-to-mouth existence.‖

Hansen and Tarp (2001) do not agree with the idea that effect of aid on economic
growth is conditioned by ‗good policy‘. After examining the relationship between
foreign aid and growth in real GDP per capita, they reported that aid in all
likelihood increases the growth rate, and this result is not conditional on ‗good‘ policy.
But they stressed the need for more theoretical work before this kind of cross-
country regression is used for policy purposes.
The World Bank Research Paper (1998) obviously takes the side of neo-liberals. It
reflects that poverty is basically the result of government failure. It is the failure to
follow good policy and sound economic management. The good policy and
economic management that have been advocated by World Bank is known by the
name ‗Washington Consensus‘- a 10 point policy description and prescription by
IMF and World Bank16. But do all agree that the Washington Consensus
promoted greater equality and poverty reduction?
The Reality of Aid Report (2002) stressed that for much of the last two decades,
the Washington Consensus has fed through a doctrinaire insistence by the IFIs
that developing countries should elevate economic orthodoxy above human need.
The report argues that there is positive relationship between greater equality and
poverty reduction, as widely believed among the donors in recent years. But the
distributional impact of reforms, prescriptions inspired by the Washington
Consensus and imposed upon so many developing countries, is at best unclear,
and early claims that reform would improve distribution appear to have been
unfounded.
The second paper of the World Bank (2002), which mainly focuses on the
experience of the World Bank, emphasized the effectiveness of aid increases when
recipient countries are the primary drivers of their own reforms and institutional
development. The study report highlighted that foreign aid is increasingly a
catalyst for change. Well-allocated foreign aid has been an effective means of
supporting poor countries and poor people in their efforts to improve their lives;
and with improved allocation and better design and delivery of assistance, aid is
more effective today than ever before (World Bank, 2002).
16
The World Bank –World Development Report 2000/2001- Attacking Poverty lists the ten objectives of the
`Washington Consensus' as follows:
1) Fiscal discipline; 2) Redirection of public expenditure toward education, health

and infrastructure investment; 3) Tax reform - broadening the tax base and cutting
marginal tax rates; 4) Interest rates that are market determined and positive (but
moderate) in real terms; 5) Competitive exchange rates, 6) Trade liberalization -
replacement of quantitative restrictions with low and uniform tariffs; 7) Openness to
foreign direct investment; 8) Privatization of state enterprises; 9) Deregulation _
abolition of regulations that impede entry or restrict competition, except or those
justified on safety , environmental and consumer protection grounds, and prudential
oversight of financial institutions; 10) Legal security for property rights

To illustrate the effectiveness of aid in poverty reduction and the efficiency gained
due to the shift in allocation the Bank report reads as follows: ―In 1990, another $1
billion in net disbursements allocated proportionately to ODA would have lifted an
estimated 105,000 people permanently out of poverty. But with the improved 1997–98
allocations, an additional one-time expenditure of $1 billion in ODA would have lifted an
estimated 284,000 people permanently out of poverty.” While these estimates are
merely indicative, the Bank suggests that the poverty-reduction productivity of
ODA nearly tripled during the 1990s (World Bank, 2002).
A scrutiny of the efficiency of aid allocation, by Collier and Dollar (2002), reveals
that the actual allocation of aid is radically different from the poverty efficient
allocation. With the present allocation, Collier and Dollar reported, aid lifts
around 10 million people annually out of poverty in sample countries. With a
poverty-efficient allocation, the productivity of aid would nearly double. The
allocation of aid that has the maximum effect on poverty depends on the level of
poverty and the quality of policies.
Contrary to World Bank and its staff, Nunnenkamp (2002) argues that the success
story of World Bank rests on an extremely weak foundation: He cited three reasons.
 First, the distribution of World Bank financing was dominated by the contribution
to financial rescue packages for some emerging markets, rather than poverty
concerns and policy assessments.
 Second, the picture portrayed in the report has not taken into consideration two
outliers with extremely high per capita aid (Cape Verde and Honduras), and the
report would have taken a bad turn if these two outliers were excluded from the
sample.
 Third, according to his regression results, the allocation of World Bank aid did
not improve in the course of the 1990s.
On the other hand, Kosack (2003) looked into effectiveness of aid, by focusing on
its ability to improve quality of life, measured in Human Development Index
(HDI). He finds that though aid does not affect quality of life in the aggregate, it is
effective when combined with democracy, and ineffective (and possibly harmful)
in autocracies. The results suggest that to make aid more effective it should be
combined with efforts to encourage democratization.
Easterly (1999) link the failure of aid to bring growth to the persistent use of the
outdated Harrod–Domar growth model in the international financial institutions
(IFIs). He noted that the economists at IFIs use the Harrod–Domar growth model
to calculate short-run investment requirements for a target growth rate, and then
calculate a ‗‗financing gap‘‘ between the required investment and available
resources and often fill the ‗‗financing gap‘‘ with foreign aid. But the two
predictions of the financing gap model: 1) aid will go into investment one for one,
and 2) there will be a fixed linear relationship between growth and investment in
the short run, have never been a reality in developing countries.

William Easterly in his recent Book entitled „The Elusive Quest for Growth‟ (2001)
links failure of development aid to ‗‗failed incentives‘‘ and ‗‗failed institutions‘‘.
He concludes that development efforts failed because the World Bank and the
poor were betrayed by the political elites that control governments in poor
countries. Easterly (2001) emphasized, ―At a minimum, if we learn nothing else from
the quest for growth, ‗we economists who work on poor countries should leave aside some
of our arrogance. The problem of making poor countries rich was much more difficult
than we thought.‖
A lesson we can draw from this contrasting and at time contradicting studies is
that the complexity of social and economic change means that the impact foreign
aid/finance (one factor) cannot be separated easily from other factors. Moreover,
the World Bank cross-country regressions (World Bank, 1998, 2002) were limited
to aid flows and policy, on the one hand, and growth and poverty reduction on
the other hand. Except exemplary discussion of overall change in child mortality
and school enrollment, and cases of a few countries performances, the cross
country regressions of World Bank and other studies did not include the various
child wellbeing indicators in the analysis as a variable. And there is no statistical
evidence of how financial aid specifically affected child wellbeing in terms of
child mortality, nutrition and education, which may not necessarily follow the
same pattern. This implies that although there a number of contrasting and
contradictory views and findings on the effectiveness of aid, assessing the effect of
foreign aid/finance or at least investigating its association with child wellbeing is
a challenging task and interesting area to explore.
Before proceeding to how the flow of foreign aid/finance to developing countries

affects child wellbeing, we will look into the problems related to measurement of
foreign aid/financial flows, which has been a contested issue, especially in recent
years.
4.5.5 How to measure aid/ foreign financial flows
The OECD‘s Development Assistance Committee (DAC), publishes information

on its member‘s aid to developing countries- that is, grants plus net
disbursements of concessional loans that have at least a 25% grant component.
Questioning the methodological shortcomings of conventionally-used measures
of aid such as ODA, that lump together grants and loans, a different approach
was developed by Chang et al. (1998) that measures official aid flows as the sum
of grants and the grant equivalents of official loans. They call this effective
development assistance (EDA). EDA is defined as the sum of grant equivalents
and grants, excluding technical assistance and debt forgiveness figures. This
adjusted measure uses the same conventional grant data but extracts grant
equivalents of loans (GQ), rather than the full face value of all loans deemed
concessional, and add that to the figure of pure grants to accurately reflect true
aid flows. Chang, et al. (1998) argue that this conceptually-superior aid measure
can diverge significantly from the conventional aggregates and provide a quite
different view on major aid trends.

On the other hand the World Bank Policy Research Report (1998) suggests that
most aid is in the form of grants so that new approach does not have much effect
on the overall measure. The report further indicated that the two measures are
highly correlated and produce similar results in econometric analysis (World
Bank, 1998).
Recently there are critical views raised by Renard and Cassimon (2001) on
measuring aid. In their article entitled ‗On the Pitfalls of Measuring Aid‘ they
argued against measuring aid from the perspective of donor effort rather than
recipient value, which stemmed from a monopoly position of DAC/OECD in the
interpretation of aid. They also strongly oppose the new approach of measuring
aid developed by Chang et al. (1998) that excluded debt forgiveness and technical
assistance from aid statistics altogether, as it does not take into account at least the
opportunity cost to the donor economy. As alternatives, Renard and Cassimon
(2001) come up with an array of five different approaches to measuring aid.
These include:- 1) gross budgetary cost, 2) net budgetary cost, 3) economic cost, 4)
acquisition value, and 5) final value, in increasing order of sophistication. The
first three measure aid from donor‘s perspective and it is therefore cost at origin,
while the last two measure aid from recipient‘s perspective, hence, it is value at
destination. According to Renard and Cassimon (2001), DAC uses what
corresponds to their first approach: gross budgetary cost, which overstates the
economic cost to the donor. They argued that the ideal perspective is an
opportunity cost approach from the donor‘s point of view. If the perspective is the
benefit to the recipient, rather than the cost to the donor, the acquisition value
approach offers a more realistic alternative to measuring the final use value.
Unfortunately, they commented, the more we move to the next higher level, the
more difficult calculations also become.
Although the acquisition value, the measurement that tells us what benefit has
gone into the economy of the recipient is the best to gauge also the effects it
generates, the unavailability of data will force us to use the gross budgetary cost
data being produced by OECD/DAC. Depending on the variability of aid
composition among the countries, the result might be variable. But based on the
World Bank Report (1998), which reported that the two measures (EDA and
ODA) are highly correlated and produce similar results in econometric analysis,
we will assume there is no much variation in aid compositions among developing
countries, which affects the proportion goes into the economy of the recipient. i.e.
all are affected equally.
Another issue related to measurement is which is the appropriate measure for

cross-country comparison? The net transfer in absolute dollar terms (size of
foreign aid/finance flows), or the different measures of aid intensities such as:
per GNP, per capita, per government budget; per export earnings? The absolute
dollar terms of size of foreign aid/finance flow is a lump sum that disguises the
importance of aid for recipient country. A financial flow of US$100 million is a
considerable amount of money for a country (for example Swaziland) whose

population is about 1 million and whose economy generates GNP of about US$1
billion. On the contrary the same financial flow is meaningless for a country (e.g.
Mexico) whose population is about 100 million and whose economy generates
GNP of about US$350 billion by the year 2000. In terms of intensity this mean US
$ 100 per capita and about 10 percent of GNP for Swaziland while it is US$ 1 per
capita and about 0.03 percent of GNP for Mexico. Therefore the importance of
foreign aid/financial flows is more meaningful if we measure it in terms of its
intensities rather than its absolute size. The same argument serves for debt
service. The only difference is that debt is intrinsically paid from country‘s export
earnings, and should be measured in terms of the ratio of export of goods and
services.
4.5.6 Effect of foreign aid/finance on child wellbeing during the decade
For empirical analysis I will concentrate in this section on the relation of foreign
aid/finance vs. child wellbeing in three dimensions. 1) aid (ODA)– child
wellbeing relation; 2) private capital flows–child wellbeing relation; and 3) debt
service and child wellbeing relation. All are macro level aggregates based on
average performance during the decade.
4.5.6.1 Aid allocation in relation to child wellbeing
First, let us see if aid allocation during the decade has some association with the
level of child mortality at the beginning of the decade. Figuring out this
association will help us to know, if aid allocation by donors is in response to the
level of the development challenges the developing countries are experiencing;
and from sense of altruistic and for the betterment of disadvantaged nation,
which is regarded as public good of the international community (to use the words of
Paul Azam and Jacques Laffont (2003).
The following figure (fig-13) presents association of Aid/GNP –Vs.- under five
child mortality rates by the year 1990 (i.e. at the begging of the decade) before and
after transformation to logarithms17. In both cases, despite few outliers, which
have become less disturbing after transformation, the figures depict that there is
strong and positive association of Aid/GNP during the decade–Vs- under five
child mortality rate at the beginning of the decade (r= 0.660 to 0.757; p<0.001).
This is good news for the donor community, as it is ‗the proof‘ that they were
really altruist and care for children-of the world. It is also good news for under
five children of the developing countries- as they have caught the attention of the
economically advantaged international community, and not neglected for being
born in poor nations-which was neither their choice nor their mistake.
17
The transformation is done not simply for the sake of visualization but also for statistical reason. Under -5
mortality rate is increasing more slowly (at decreasing rate) than Aid/GNP ratio (%). In such a case
logarithmic transformation is an appropriate statistical tool to explore linear association (Maddala,1992) .

Fig.-13. Scatter plot of under -5 child mortality rate by 1990 vs. Aid allocation (as % of
GDP) during the decade 1990-2000 (before after log transformation)
400
Sierra
NigerLeone
300 Angola
Mali Guinea Bissau
Guinea Mozambique
Congo, Dem. Rep.
200
Nigeria
Mongolia
100
Nicaragua
0
-10 0 10 20 30 40 50 60
Aid to GNP ratio (%)- Annual Average (1990-2000)
6.0 Sierra Leone

Guinea Bissau
5.5
Nigeria
5.0 India
4.5
Nicaragua
Brazil
4.0 Saudi Arabia
3.5
Sri Lanka
3.0
2.5
-6 -4 -2 0 2 4 6
Log of Aid-GNP ratio- Annual Average (1990-2000)
(a) Pearson r= 0.66**18, Spearman‟s riho r=0.76**, n=104

(b) Pearson r= 0.68**, Spearman‟s riho r=0.75**, n=104
Source: Graph constructed by the author from UNICE, 2002 & WDI, 2001 data base
18
**Correlation is significant at the 0.01 level (2-tailed)

At appeared on the graph there are a few outliers/deviants. The five SSA countries
(Sierra Leone, Niger, and Angola, Mali, Guinea, Congo Dem. Rep, and Nigeria) with
very high under-5 child mortality rate- seem to be disfavored by donor community in
their Aid/GNP allocation. While Guinea-Bissau and Mozambique from the same
region, Mongolia from East Asia, and especially Nicaragua form Latin America
seem to be favored.
It is found that the few outliers have their own explanation. The issue is not a matter
of discriminating against the former in favor of the latter group. It is the matter of
the particular situation(s) of the countries that aggravates child mortality among
the former group, and special circumstances that let donors to allocate more aid
with regards to the latter group. For example the brutal civil war in Sierra Leone
and Angola-which dwarfed and sometimes blocked the assistance of the
international community and created extreme difficulty even for the
humanitarian agencies to operate in the country; the recklessly corrupt
government and civil war in Congo Dem. Rep; the regular civil unrest and poor
social services in Nigeria in spite of its big economy in Africa― which made its
nation at odds with its naturally endowed wealth, are among the few to mention.
Guinea-Bissau and Mozambique are logically not outliers, as also seen on the
transformed graph. They are among the 12 countries in the world (of course all
from SSA including Nigeria), where U5CMR was more than 200 per 1000 LB in
1990. The ratio of Aid to GNP seems high due to their small economy (e.g. for
Guinea Bissau Annual Average GNP at market prices was US$226.7 millions
during the decade (WDI, 2001). Mozambique is the country which came to a
political settlement in 1992 after 14 years of civil war, and obtained relatively
better support from donors for stability and economic recovery. However, the
major aid flow was due to the serious setbacks the country suffered when, in early
2000, it was hit by floods which affected about a quarter of the population and
destroyed much of its infrastructure (BBC News, Mozambique Country profile, 27
May, 2003 Update.) The only exception is probably Nicaragua as it was favored
by US due to the fact that Sandinistas, the leftist ruling party of Nicaragua that
was at odds with the US during 1980s, were defeated in 1990 by a US-sponsored
counter-revolution group (BBC News, Nicaragua Country profile, 10 July, 2003
update). But for this country too, the major factor was the devastations by
Hurricane Mitch in 1998, which killed thousands, rendered 20% of the population
homeless and caused billions of dollars worth of damage (BBC News, ditto) that
let the international donor community to contribute more to the relatively least
performing economy in Central America, whose average GNP was only about
US$ 1.5 billion during the decade (WDI, 2001).
We see also some new deviants which were discovered after transformation.
Saudi Arabia, Brazil and India found to be negative deviant. These countries are
among the top 10 biggest economy of the 105 developing countries included in
this study. They get little aid as compared to their economy. Their deviations
rather indicate the poor commitment of the government of these countries to
improve the wellbeing of their children and inequality in getting access to the
wealth of the country. In other words children were denied their right to share
from the big economy of their nation. Except for Brazil, which is admirably low,
during the decade average budget allocated for defense is 36% of central
government expenditure in Saudi Arabia and 15% in India. One of the major
explanations for Brazil is probably inequality to get access to the nation‘s income.
It is one of the top five countries in the developing world where inequality as
measured by Gini Index is greater than 60. We will see in more details effect of
inequality in the last section of this paper.
There is one challenge left to bless the donor communities‘ as purely altruist and
humane in their assistance. That is aid per capita allocation. Was it in similar
pattern with aid per GNP allocation? The answer is yes. As depicted in the
following figure (fig.-14) there is a positive and significant association between
under-5 child mortality rate by 1990 and aid per capita allocation during the
decade of the World Summit for children (r= 0.291 to 0.358 at 0.001<p<0.003). But
there is one difference. The association is more strong in the former (when we use
aid per GNP allocation (r= 0.660 to 0.757 at p<0.001)). This suggests the need for
developing Aid Allocation Index (AAI) for equitable reduction of poverty and
sustainable development, on which the international community agreed to fight
for.19
Fig.-14. Scatter plot of under -5 child mortality rate by 1990 vs. Per capita Aid allocation
during the decade (1990-2000 )
400 6.0
Afghanistan
Sierra Leone
Niger 5.5 Congo, Dem. Rep.
Nigeria
300 Angola
Log of Under -5 mortalirty rate -1990
Afghanistan 5.0 Myanmar

India
Guinea Bissau
Under-5 mortality rate 1990
Congo, Dem. Rep. 4.5

Ethiopia
Nigeria Nicaragua
200 Mauritania Brazil
4.0 Jordan
Gabon
Namibia 3.5
100
Botswana Nicaragua
Jordan Jamaica
3.0 Costa Rica
0 2.5
-20 0 20 40 60 80 100 120 140 0 1 2 3 4 5
Aid per capita (current US$)- Annual Average (1990-2000) log of Aid per capita (current US$)- Annual Average (1990-2000)
(a)Pearson r= 0.29 (p<0.01), Spearman‟s riho r=0.42(p<0.01), n=105

(b) Pearson r= 0.37 (p(0.01), Spearman‟s riho r=0.40 (P<01) n=104
Source:: Calculation and graph construction by the author from UNICE (2002) & WDI ( 2001) data base
19
If aid is primarily intended for the reduction of poverty and sustainable improvement of the wellbeing of
people in developing countries we have to have a sort of Aid Allocation Index (AAI) to measure equitable
aid allocation taking into account Population, Poverty Index, Child Wellbeing Index, Size of Economy, and
Skin Size of the Country- as part of the global natural resources. But it is beyond the scope of this paper.

Here again we have some observations that look like outliers/deviants. Most
deviants (Sierra Leone, Niger, Angola, Nigeria, Congo Dem Rep., India, Brazil
and Nicaragua) are those appeared on the previous scatter plot. The newly
appeared ones are Afghanistan and Ethiopia as negative deviant and Jordan,
Namibia, Botswana, and Gabon as positive deviant before transformation. After
logarithmic transformation, we are actually left with six negative deviants (Brazil,
India, Myanmar, Nigeria, Congo Dem Rep and Afghanistan) and two positive
deviants (Jordan and Nicaragua). We have already seen some explanation for
poor performance of Brazil, India, Nigeria, Cong Dem Rep in terms of child
wellbeing indicators, and for a positive deviation of Nicaragua. The only
additional explanation here is population. India (over 1 billion), Brazil (over 170
million) and Nigeria (over 113 million) are among the 10 most populous nations
in the world (WDI, 2001). As our measurement is aid to population ratio, it is
inversely related to population keeping other things constant. As we have seen
with the example of Swaziland –vs.- Mexico earlier in this section, some large
lump sum amount of aid is like a drop in the ocean for a country with a large
number of population. But this should not be mistaken for the effect of
population on the child mortality rate. There is no association found to exist
between the child mortality rate and total population as depicted in the following
table (table-9). This is, of course, clearly seen in the scatter plot which is not
presented here for sake of space.
Table-9. Correlation matrix of under 5 mortality rate (1990 and 2000) vs. total
population and under 5 population in 2000.
Total Log of Under 5 Log of
population Total Population Under 5
(thousands) population (thousands)- Population
Pearson Correlations (in 2000) (in 2000) 2000 -2000
Under-5 mortality rate 1990 -0.07 -0.06 -0.02 0.10
Sig. (2-tailed) 0.50 0.52 0.84 0.32
N (valid count/ country) 105 105 105 105
Under-5 mortality rate 2000 -0.09 -0.11 -0.05 0.05
Sig. (2-tailed) 0.36 0.28 0.62 0.58
N (valid count/ country) 105 105 105 105
Source:: calculated by the author from UNICE (2002) & WDI (2001) data base
It is also found that the newly appeared deviant (‗outliers‘) have their own
explanation. For instance, in the case of Ethiopia we can see two reasons. The
repeated and devastating famine in 1984/85 and the ever long civil war (for about
30 years) reached the climax by 1990 before it paused, at least, by overthrowing a
‗Marxist‘ military dictator in 1991. This made it difficult for children to survive,
and for western donors to extend more aid. The devastating war erupted again in
1998 and extended up to 2000, in claim of boarder with the newly independent
state- Eritrea, one of the 14 provinces of Ethiopia until 1991. These coupled with
the large number of population (62 million by 2000) made Ethiopia, one of the 27
countries who at the start established the World Bank, among one of the least
favored countries in terms of aid per capita allocation (Dereje Dejene, 2003).

Afghanistan, which did not appear on the previous scatter plot due to absence of
aid/GNP data, now appeared very clearly to be one of the worst countries for
children to born there, and a very difficult country for donors to support. This
was primarily due to continuous civil war that devastated the country; and
imposition of new and extreme Islamic rule by Taliban20 regime, which was
originally trained and supplied with military facilities by the US, Saudi Arabia,
Pakistan, and others (CIA- The World Fact Book, Jan 2003). The Taliban regime,
who was recognized only by three nations as the legitimate government of
Afghanistan, made it difficult even for the purely humanitarian NGOs to function
in that country, until it was removed by US and allied forces for hosting terrorist
leaders believed to be responsible for September 11/2001 attack in US.
The positive deviation of Jordan (getting more aid per capita as compared to other
countries with the same child mortality rate) seems special. Jordan is a small
country with limited natural resources, but for years it has followed a very
cautious diplomatic relation with the West and neighboring Arab States. This
coupled with the 1990-91 Gulf War that slashed export revenues and triggered an
influx of refugees from neighboring Iraq, made the country to secure more aid to
the extent of suspending an IMF-inspired program of budgetary austerity (BBC
News, Jordan- country profile, July 17th 2003 update, The Economist, July 13th
2002)
4.5.6.2 Effectiveness of Aid on child wellbeing
We established that there is fairness in aid allocation from the above analysis,
which depicts, in all dimensions that aid allocation during the decade is
responsive to U5CMR at the beginning of the decade. Now the issue is
effectiveness of this aid in improving child wellbeing, measured in terms of the
change in child mortality rate, change in prevalence of malnutrition and change in
level of NER in primary education. Once we said the allocation is fair, the use of
these resources to improve child wellbeing depends on the efficiency of the
government of developing countries, provided that there are no special
circumstances in the particular country.
So the question becomes: Did the government of developing countries efficiently use
the aid money to improve the wellbeing of children OR did not use the resources in a
way that meet the needs and fulfill the rights of children and as the result failed to
attain the Summit Goals?
To answer this difficult and sensitive question, let us use the analogy of the micro-
economic theory. In microeconomic modeling, the underlying assumption is that
the goal of producers (or business firms) is to maximize profits subject to the
20
Cambridge Dictionaries Online - defined Taliban as „a Muslim political and military organization, with
very traditional ideas about society and women, who took power in Afghanistan in the 1990s‟

constraint of existing technology and know-how used to convert the inputs into
the desired output, plus risk and uncertainty.
Producers exist to convert inputs (Labor, Capital, Land and Raw Materials, and
Entrepreneurship) into desired goods and services in an efficient manner. Given
that output prices and factor ‗prices are determined in competitive markets‟, efficiency
means exploiting existing production technology to the greatest extent possible.
Profits earned by the entrepreneur, that are at least equal to what the
entrepreneur could earn by working for someone else, represent the reward for
achieving efficiency in production (relative to competing producers) and taking
risks (facing an uncertain demand for the output).
Now if we consider the government as an entity whose function is to produce

goods and services to maximize the wellbeing of the society (in our case children)
- as its gains (profit). The maximization of its gains will be subject to a number of
constraints and uncertainty. These include input constraints such as availability of
natural resource stocks (the land, water, biological resources, etc) that can be
utilized by government or its people to generate means of survival; availability of
physical infrastructure and technology, availability and quality of human
resources, financial resources or capital stock of money to which the government
has access to invest in acquiring and/or improving other inputs and production
of goods and service; and other factors such as institutions, social relations and
level of civil or community organization; plus trends, uncertainty and shocks at
local and international level such as political, market, civil war, weather shocks
and other natural or man made circumstances.
Development aid is basically, although not exclusively, about addressing one of

the input constraints― the financial resource constraints. Although it is also partly
used to acquire and/or improve the other inputs to produce the required goods
and services that maximize the gains in child wellbeing. Efficiency of resource
use (aid money) thus depends on the availability of other inputs and the extent to
which existing available other inputs and technology are exploited, as well as the
extent to which other factors and uncertainty are conducive for efficient use of
financial resource and other inputs. This means, in economic jargon, economic
efficiency of resource use depends on technical efficiency (availability and use of
input to maximum possible) and the optimal combination and use of these input
in such a way that it will generate maximum gains in child wellbeing (i.e
allocative efficiency): subject to other inputs and factors indicated above.
Although controlling for all these factors is a very difficult task in terms of data
availability, we will first look at the overall phenomenon and see, in the last
chapter of this paper, what it looks when we control for some of the factors in
regression analysis.
The first overall phenomenon seen in this analysis is graphical diagnosis and
analysis of correlation of aid money flowed into developing countries, measured
in terms of Aid/GNP ratio and Aid per Capita (US$) and progress made by

developing countries in improving the child wellbeing. The correlation analysis

(table-10), with and without transformation to logarithm, it is found there is
negative or no association between the progress made in reducing U5CMR and
prevalence of malnutrition vis-à-vis the amount of aid transferred to developing
countries during the decade. However, there is positive association between the
amount of aid flow during the decade and progress in total NER and female NER-
primary education over the decade. Association of aid flows with progress in
female NER-primary education is nearly significant (p<0.1).
Table-10 Correlation matrix of progress in child wellbeing indicators vs. aid allocation
during the decade (1990-2000)
Log of
Aid to GNP Annual Aid per capita Log of
ratio (%)- Average (current US$)- Annual
Annual Aid-GNP Annual Average Aid
Indicators of progress in Child Average ratio (1990- Average (1990- per capita
wellbeing (1990-2000) 2000) 2000) (1990-2000)
U5M -Decade reduction (%)
1990-2001 -0.25* -0.26** -0.19+ -0.18+
N (valid count/sample size) 93 95 97 101
Decade reduction of
prevalence of malnutrition
(%) -0.37** -0.44** -0.06 -0.19
Progress in total NER-
primary (1990-2000) 0.19 0.15 0.18 0.11
Progress in female NER-
primary (1990-2000) 0.24+ 0.21 0.16 0.13
Source:: Based UNICEF (2002) and WDI (2001) data base CD-Rom and WDI (2003) online data base.
** Pearson Correlation- significant at the 0.01 level (2-tailed). * Pearson Correlation-

significant at the 0.05 level (2-tailed); + Pearson Correlation -significant at the 0.10
level (2-tailed).
In general the matrix is telling us that child wellbeing indicators are either
negatively related or non-responsive, in economic jargon inelastic, to the amount
of aid transferred to developing countries From this correlation we can sense that
whatever factor we control for it, which will of course be seen later on, the
direction of association might persist.
This analysis, contrary to End decade UN secretary General Report (2001) and
World Bank report (1998), on the basis of which the theoretical construct was
formulated, indicates that where aid allocation- in terms of Aid per GNP ratio or Aid
per capita- was high, there were less progress made or even some countries were in
retrogression. Conversely where foreign financial support was low there was
significant improvement in child wellbeing.

One observation from graphical analysis of the amount aid flows measured in aid
per GNP ratio and progress in reduction of U5CMR (fig-15) is that there seem to
exist increasing returns to aid with some exceptions (like Zambia, Rwanda,
Tanzania and Mauritania and one side and Oman and Malaysia on the other
side). i.e. there a tendency for higher reduction of U5CMR at higher aid to GNP
ratio than at low aid to GNP ratio, which hint at the need to explore the
association using quadratic function. We will see this in more detail in Chapter V.
Fig.-15. Scatter plot of under -5 child mortality rate reduction over the decade -vs. aid
(% GNP) transferred to developing countries during the decade (1990-2000).
60 Malaysia
Oman
Ecuador
Bangladesh
Bhutan
40 Brazil Lao PDR
El Salvador Bolivia
Peru
Guinea EritreaMongolia
Argentina KyrgyzstanUganda
Viet Nam Malaw i
20 China NamibiaGhanaBenin Gambia
Niger
Colombia
Sudan
Lesotho
Tajikistan Senegal
Burkina Faso
Nigeria
Georgia Central African R. Mauritania
Tanzania
0 Angola Zambia
Rw anda
Uzbekistan
Kazakhstan Côte d’Ivoire
South Africa Cambodia
-20 Algeria Kenya
Sw aziland
-40
-10 0 10 20 30 40
Aid to GNP ratio (%)- Annual Average (1990-2000)
Source:: Graph constructed by the author from UNICE (2002) & WDI ( 2001) data base
The association does not seem to be the matter of allocation efficiency as argued
by Collier and Dollar (2002 or as reported by World Bank. As we have seen in the
above section, the aid allocation by donors- be it in terms of Aid per GNP ratio or
Aid per Capita- was significantly responsive to the situation of countries in terms
of child wellbeing indicators. Poor allocation is when money is going to where it
is not needed. The problem might be the sufficiency and other factors and
constraints which must be addressed to make aid money effective.
The challenge is know whom we have to blame for?. There is no such a general
truth to say getting helping hand will have negative effect on the person to be
helped. The general truth is rather the contrary; especially getting helping hand at
the time when one found herself/ himself in hot-water. For any nation there is no
cause which merits a higher priority than the protection and development of
children, on whom the survival, stability and advancement of all nations - and,
indeed, of human civilization - depends.

So can we find any other explanation for the negative association of Aid to the
improvement of child wellbeing indicators in developing countries? Was it due to
pervasive poverty in the developing countries that the aid money could not make
any difference? Or was it due to the emerging challenges of HIV/AIDS and
domestic conflicts that widely spread in developing countries that the
contribution of aid for development dwarfed and/or reversed? Or was it due to
the low level of knowledge (education) of adults and inaccessibility to
Information Education and Communication (IEC) that parents could not provide
appropriate care for children?.
OR
Can we conclude by saying that the government of developing countries misused the
resources and used children as hostages and bargain with child mortality and
malnutrition to secure more funding for further misuse and personal gain? This is, of
course, the central argument of William Easterly (2001) who considered different
explanations for the development failures, in his highly heralded book, ‘The
Elusive Quest for Growth’: Economists‟ Adventures and Misadventures in the
Tropics,‟ and finally placed the blame for persistence of poverty in poor countries
on governments and political elites that used their poor as hostages to personally
benefit from aid resources and debt relief. I certainly agree with William Easterly,
except I have the opinion that his book was written and his conclusion was derived
based on „convex mirror image.‘ He didn‘t show what the image will look like when
we use ‗concave mirror‘, or, at least two plain mirrors21.
I absolutely agree with his statement, which I quoted already somewhere in this
chapter that says, ‗The problem of making poor countries rich was much more difficult
than we thought‟. So before we conclude that it was misused by government of
developing nations or proceed further in to the analysis of the role of other
factors, let us look at other dimensions of Aid.
Here we can see two dimensions- ‗The Debt Service‟, which is commonly referred
as one of the main causes for developing countries to get poorer, and disable the
government‘s capacity to provide health and education services for its people;
and Private Capital Flows-which is known for its creation of employment and
improving income of developing nations, on one hand; and for its volatility and
creation of economic and financial crisis on the other hand.
The following table (table-11), which was constructed after graphical analysis and
checking for outliers, depicts that private capital flows- measured in terms of percent of
GDP, at purchasing power party (PPP) during the decade- has negatively correlated with
all child wellbeing indicators except for the reduction of prevalence of malnutrition.
Its negative correlation is very significant with progress in child education
particularly with female child education (r=-0.33, p<0.05), which implies that it
also has discriminatory association (effect).
21
The book only focuses at what went wrong within, and did not look into what went wrong due to
intentional and unintentional influence of the outside world on developing countries. It is not the scope of
this paper to present critical review of this Book in a professional manner.

Table-11 Correlation matrix of progress in child wellbeing Indicators vs. private

capital flows and debt service during the decade (1990-2000.)
Gross private capital
flows (% of GDP, Total debt service (%
PPP)- Annual of exports)-Annual
Child Wellbeing Indicators Average (1990-2000) Average (1990-2000)
U5M -Decade reduction (%) 1990-2000 -0.09 0.04
N (valid count/sample size) 87 95
Decade reduction of prevalence of
malnutrition 0.21 -0.15
Progress in total NER-primary (1990-
2000) -0.27+ 0.12
Progress in female NER- primary
(1990-2000) -0.33* 0.09
Source: Based UNICEF (2002) and WDI (2001) data base CD-Rom and WDI (2003) online data base.
* Pearson Correlation-significant at the 0.05 level (2-tailed);
+ Correlation -significant at the 0.10 level (2-tailed).
Surprisingly enough debt service has no significant correlation with progress in

child wellbeing indicators; be it positively or negatively. Except for reduction of
prevalence of malnutrition, the sign of the association is positive, although all are
far from significant.
Contrary to the argument of The Reality of Aid Report (2002), however, this result
implies that whether the country is paying a huge amount of debt or a just a
penny, the resource did not make any difference on the wellbeing of children.
This is again probably due to the fact that the resources were not made available
to serve the children-OR-due to the fact that the constraints are too immense for
the resource spent to make a difference. The cynical part of this finding is, when
we think of debt relief. If debt service has no effect on child wellbeing, it seems
immaterial whether the donor communities write off the debt of the developing
country or insist to get it paid back. Before making such a bold conclusion let us
see further how other circumstances of developing countries affected the progress
towards the World Summit goals for children.

4.6 The challenge of poverty and inequality on child wellbeing

“We will spare no effort to free our fellow men, women and children from the abject
and dehumanizing conditions of extreme poverty, to which more than a billion of
them are currently subjected‖ U N Millennium Declaration-Resolution 55/2 – Sept. 2000
4.6.1 Understanding Poverty

Poverty and income inequality as the major development problems that become
acute and could no longer be ignored in development theories and analysis.
Poverty and income inequality entered into development doctrine in the decade
of 1970s, specifically by World Bank and ILO. Consequently, a more equitable
income distribution, particularly in terms of a reduction in absolute poverty, was
given a much greater weight in the reference function of most developing
countries compared with the objective of aggregate growth per se (Thorbecke,
2000), which has been the major objective- and seen as necessary and sufficient
condition-for economic and social development during the 60s. Poverty
(alleviation) reduction dropped in 1980s due to financial crisis, and priority
became maintaining external balance of payment and internal-budget
equilibrium22. It resurrected in 1990s, particularly spearheaded by the World
Bank23, and became the top priority of the Millennium Development Goals
(MDGs)24 set by the end of the century at the United Nations Millennium
Declaration, in which all countries in the world, the World Bank and all UN and
other international organizations committed themselves to realize it (UN
Millennium Declaration-Resolution 55/2, September, 2000).
The following statements of Kofi Annan, Secretary-General of United Nations in

his End Decade Report (2001) depicts the emphasis with regards to the challenge
of poverty and inequality as one of the most prominent obstacles to attain the
World Summit for children. “Indeed”, the report said, “ ‟chronic poverty‟ remains
the single biggest obstacle to meeting the needs and fulfilling the rights of children. Some
1.2 billion souls live in what the World Bank categorizes as absolute poverty, stripped of
all human dignity as they struggle to survive on $1 a day in conditions of almost
unimaginable suffering and want. Half of them are children.” Referring to „inequalities‟
the Secretary General report stated, ‗the picture that emerges is one of a polarized
world characterized by significant disparities, not only among regions and countries
but also within countries.‘
22
The 1980s decade is known as the decade of painful stabilization and structural adjustment for some, and
for others it is known as the lost decade of development.
23
Conceived and established by the end of World War II as the International Bank for Reconstruction, and
its primary has been supporting reconstruction and investment in power and communication sector. Today,
however, the Bank has sharpened its focus on poverty reduction as the overarching goal of all its work; and
its mission Statement become ―To reduce poverty and improve living standards through sustainable growth
and investment in people‖- publicly known as ―The World Free of Poverty‖
24
The Millennium Development Goals include eight major goals listed below -in very brief phrases.
Eradicate extreme poverty and hunger Improve maternal health
Achieve universal primary education Combat HIV/AIDS, malaria, and other diseases
Promote gender equality and empower women Ensure environmental sustainability
Reduce child mortality Develop a global partnership for development

Before going into the analysis of how poverty affects child wellbeing or how one
is related to the other, let us look at brief review of literatures on how poverty is
defined and understood among different people and/or organizations.
Traditionally, poverty has been defined in terms of shortfalls of consumption or

income. Income poverty lines are set against the cost of a basic diet for a group
and/or the combination of dietary needs and a few non-food essential items.
Currently the widely used income poverty definition, which is also one of the
targets of the Millennium Development Goals of poverty reduction, is subsisting
on US$1 per day or less.
The Human Development Report of UNDP (1997) introduced the concept of

human poverty with a view to look beyond income poverty. Dimensions of
human poverty are rooted in general deprivations such as powerlessness and lack
of capabilities. The concept of human poverty also includes more specific
dimensions that are difficult to measure - lack of political freedom, inability to
participate in decision-making, lack of personal security, inability to participate in
the life of a community and threats to sustainability and intergenerational equity.
The report emphasized, ―If human development is about enlarging choices, poverty
means that opportunities and choices most basic to human development are denied- to
lead a long, healthy, creative life and enjoy a decent standards of living; denied freedom,
dignity, self-respect and the respect for others freedom.‖
According to the collection of writings about poverty, by World Bank25, in order

to promote an understanding of its very real effects on human lives, one can find
different interpretation of what poverty is about. Some emphasize the tragedy of
poverty in striking the most vulnerable of society. Some describe long-perpetrated
social and political injustices as contributors to poverty. Others write that poverty
is a noble existence which shows the human potential for strength and spirituality
in the face of hardship.
The World Development Report 2000/2001, published by the World Bank with
the title ‗Attacking Poverty’ accepts the now traditional view of poverty as
encompassing not only material deprivation (measured by an appropriate concept
of income or consumption) but also low achievements in education and health.
According to WDR 2000/2001 definition: Poverty is pronounced deprivation in
well-being. ―To be poor is to be hungry, to lack shelter and clothing, to be sick and not
cared for, to be illiterate and not schooled. Poverty is not having a job, is fear for the
future, living one day at a time. Poverty is losing a child to illness brought about by
unclean water‖. The report also broadens the notion of poverty to include
vulnerability and exposure to risk—and voicelessness and powerlessness. ―Poor
people are particularly vulnerable to adverse events outside their control. They are often
treated badly by the institutions of state and society and excluded from voice and power in
those institutions. Poverty is, thus, also powerlessness, lack of representation and
freedom‖ (World Bank, 2000.)
25
Please see http://www.worldbank.org/poverty/povlit/index.htm; for further details.

The Noble Prize winner in Economic Sciences in 1998 "for his contributions to
welfare economics" Amrtya Sen (2001) calls all these forms of deprivation- forms
of unfreedom, that severely restrict the capabilities that a person has to lead the
kind of life he or she values-and has reason to value. Amartya Sen argues, ―There
are good reasons for seeing poverty as deprivation of capabilities, rather than merely as
low income. If our attention is shifted from an exclusive concentration of income poverty
to the more inclusive idea of capability depravation, we can better understand the poverty
of human lives and freedoms in terms of a different informational base (involving statistics
of a kind that the income perspective tends to crowd out as a reference point for policy
analysis).‖ Amrtya Sen acknowledge that deprivation of individual capabilities
can have close links with the lowness of income, which connects in both
directions: (1) low income can be major reason for illiteracy and ill health as well
as hunger and undernourishment, and (2) conversely, better education and health
help in the earning of higher income. “But”, Sen said, ―there are also other
influences on the basic capabilities and effective freedoms that individuals enjoy. Thus,
the role of income and wealth – important as it is along with other influences- has to be
integrated into a broader and fuller picture of success and deprivation.‖ (Sen, 2001).
UNDP Poverty Report- 2000, under the title ‗Overcoming Human Poverty‘ came
up with two major categories and definitions of poverty. These are Income
poverty and Human Poverty; which are of course related to Amartya Sen‘s thesis.
According to UNDP, Income Poverty has also two levels.
1) Extreme (Absolute) poverty- lack of income necessary to satisfy basic

food needs usually defined on the basis of minimum calorie
requirement.
2) Overall poverty lack of income necessary to satisfy essential non-food
needs- such as for clothing, shelter, energy as well as food needs (often
called Relative Poverty.)
Human Poverty on the other hand is defined as lack of basic human capabilities:
illiteracy, malnutrition, abbreviated life span, poor maternal health, illness for
preventable diseases.
4.6.2 Measuring Poverty
If we understand poverty in such a wider perspectives and deeper dimensions the

question is now, how we can measure it? There are a number of approaches to
measuring poverty linked to its diffrent definitions. These include
(1) the traditional measurement of income poverty,
(2) human poverty approach –Human Poverty Index (HPI) –from UNDP,
(3) composite indexes of wealth ( the recent approach from the World Bank)
(4) sustainable livelihood (participatory approach),
(5) vulnerability and voicelessness/ powerlessness- (recent approaches), etc.

4.6.2.1 Measuring Income poverty
Using monetary income or consumption to identify and measure poverty, which

is commonly known, in recent years, as World Bank‘s approach, has a long
tradition. Though separated by a century, Seebohm Rowntree‘s classic study of
poverty in the English city of York in 1899 and the World Bank‘s current estimates
of global income poverty share a common approach and a common method
(World Bank, 2001).
The most straight forward and commonly used measure of income poverty is the
Incidence of poverty (headcount index): measured based on household income
and expenditure national surveys. It is the percentage of the population with
income or consumption levels below the poverty line26. It is relatively an easy
measure but it has certain disadvantages. It fails to reflect the fact that among
poor people there may be wide differences in income levels, with some people
located just below the poverty line and others experiencing far greater shortfalls.
World Bank (2001) worries also that using this measure may tempt policy makers
to direct their poverty alleviation resources to those closest to the poverty line,
while neglecting the poorest.
The second known measure of income poverty, which takes into account the
distance of poor people from the poverty line, is the poverty gap (depth of
poverty). This provides information regarding how far off households are from
the poverty line. This measure captures the mean aggregate income or
consumption shortfall relative to the poverty line across the whole population27.
In other words, it estimates the total resources needed to bring all the poor to the
level of the poverty line divided by the number of individuals in the population
(World Bank, online PRSP Source Book). The square of poverty gap is also another
income poverty measure that takes into account not only the distance separating
the poor from the poverty line (the poverty gap), but also the degree of income
inequality among the poor. That is, a higher weight is placed on those households
further away from the poverty line (World Bank, online PRSP Source Book).
The World Development Report 2000/2001 indicated that poverty measures

based on household income or consumption surveys are not free of problems.
Harpham (2002) argues that although most aspects of poverty can be measured
for the households which the child belongs, many of the measures (e.g. different
sorts of capital) are rarely applied in a child-centric way. For example, intra-
household behavior may mean that the household is not ‗poor‘ in terms of various
assets (including food), but unequal allocation within the households means that
some children (e.g. girls) may be asset poor (not have access to education or
sufficient food, etc.). Although Harpham (2002) strongly oppose the use of
26
The poverty line is the critical cutoff point (country specific or internationally comparable) of
income or consumption below which an individual or household is determined to be poor.
27
It is obtained by adding up all the shortfalls of the poor (assuming that the non-poor have a
shortfall of zero) and dividing the total by the population

household poverty as a proxy for childhood poverty, he indicated that data

deficiencies and the cost of collecting child-specific measures often leave no other
option.
Aside from the above measures, there is also a well known measure that explicitly
focus on income inequality, which is known as Gini Coefficient or- Gini Index: It
measures the extent to which the distribution of income (or consumption) among
individuals or households within a country deviates from a perfectly equal
distribution. A Lorenz curve plots the cumulative percentages of total income
received against the cumulative number of recipients, starting with the poorest
individual or household. The Gini index measures the area between the Lorenz
curve and a hypothetical line of absolute equality, expressed as a percentage of
the maximum area under the line. A value of 0 represents perfect equality, a value
of 100 perfect inequalities.
Fig-16. Example of Lorenz curve
Gini Index (Coefficient)=

Area A
(Area A+Area B)
Source: Kuan Xu (2003): Department of Economics Dalhousie University
4.6.2.2 Human Poverty Index (HPI)
The Human Poverty Index (HPI) is based on the Human Poverty Approach-
developed by UNDP as the derivative of Human Development Index (HDI).
According to UNDP (1997) the contrast between human development and human
poverty reflects two different ways of evaluating development. One way, the
―conglomerative perspective‖ focuses on the advances made by all groups in each
community, from the rich to the poor. This contrasts with an alternative view
point, the ―deprivational perspective‖, in which development is judged by the
way the poor and the deprived fare in each community. UNDP (1997)
emphasized that ―because income is not the sum total of human lives, a lack of it can
not be the sum total of human deprivation”

The human poverty approach of the UNDP focuses on three perspective of

poverty to build the Human Poverty Index (HPI).
 The first deprivation relates to survival- the vulnerability to death at a
relatively early age-and is represented in the HPI by the percentage of
people expected to die before the age of 40.
 The second dimension relates to knowledge: being excluded from the
world of reading and communication- and is measured by the percentage
of adult who is illiterate.
 The third aspect related to a decent standard of living, in particular, overall
economic provisioning. This is represented by a composite of three
variables- the percentage of people with access to health services and to
safe water, and the percentage of under five children malnourished.
The report argues that concerns with identifying people affected by poverty, and
the desire to measure it- have at times- obscured the fact that poverty is too
complex to be reduced to a single dimension of human life. Poverty of lives and
opportunities- or human poverty- is multidimensional in character and diverse
rather than uniform in content.
UNDP (2000) also suggests indirect measures of human poverty, which include
lack of access to goods, services and infrastructure-energy, sanitation, education,
communication, drinking water- necessary to sustain basic human capabilities.
4.6.2.3 Composite indexes of wealth:
This is an alternative brought into the forum by Poverty Reduction Strategy

Source Book of the World Bank. Unlike HPI of UNDP that exclude income, this
approach suggests combining the information on different aspects of poverty
taking into account income, health, assets, and education.
The World Development Report 2000/2001, however, warns that defining

poverty as a multidimensional or composite index raises the question of how to
measure overall poverty and how to compare achievements in the different
dimensions. One dimension might move in a different direction from another.
Health could improve while income worsens. Or an individual might be ―income
poor‖ but not ―health poor.‖ Or one country might show greater improvement in
health than in vulnerability—while another shows the reverse. Another major
limitation of composite indexes is the difficulty of defining a poverty line.
However, the PRSP Source Book argues that analysis by quintile or other
percentile remains possible, and offers important insights into the profile of
poverty.
4.6.2.4 Sustainable Livelihood Approach
The Sustainable Livelihood Approach to the study of poverty has particularly

emphasized the need for local participation, and thus follows a participatory

approach. In this approach each community can define criteria of well-being and
the key elements of deprivation as they appear in the local context. The process
brings out the concerns and worries of vulnerable people that are persistently
neglected in national statistics and many studies of poverty. The starting point of
Sustainable Livelihood Approach is the assets- both physical and social- owned,
controlled, claimed, or in some other means accessed by the household. It regards
the asset status of poor individuals or households as fundamental to understand
the options open to them, the strategies they adopt for survival, and their
vulnerability to adverse trends and events. It looks into what is possible rather
than looking at how desperate things are. It seeks to identify what the poor have
rather than what they don‘t have and, to strengthen peoples own inventive
solutions, rather than substitute for, block or undermine them.
During the study conducted using this approach in North Wallo province of
Ethiopia, by the author of this paper, the villagers come up with the following
poverty free life indicators: Owning a pair of oxen, more three milking cows and at
least 30 heads of sheep; having crop harvest which will cover full year household‘s food
need, having mule and horse for transport, hiring in not hiring out of labor, and having a
tin roof house (Dereje Dejene & Tsehainesh Misganew, 1998)
4.6.2.5 Vulnerability, vocielessness and powerlessness assessment
In the dimensions of income and health, vulnerability is the risk that a household
or individual will experience an episode of income or health poverty over time.
But vulnerability also means the probability of being exposed to a number of
other risks (violence, crime, natural disasters, being pulled out of school).
Measuring vulnerability is especially difficult: since the concept is dynamic, it
cannot be measured merely by observing households once. Only with household
panel data—that is, household surveys that follow the same households over
several years—can the basic information be gathered to capture and quantify the
volatility and vulnerability that poor households say is so important. Moreover,
people‘s movements in and out of poverty are informative about vulnerability
only after the fact. The challenge is to find indicators of vulnerability that can
identify at-risk households and populations beforehand (World Bank, 2000).
Voicelessness and powerlessness on the other hand can be measured using a

combination of participatory methods polls, and national surveys on qualitative
variables such as the extent of civil and political liberties. However, measuring
these dimensions of poverty in an accurate, robust, and consistent way so that
comparisons can be made across countries and over time will require considerable
additional efforts on both the methodological and data-gathering fronts (World
Bank, 2000)
So which measure to use? What we can summarize from the above forms,
dimensions and measures of poverty is that child wellbeing indicators are part
and parcel of poverty dimensions and measurement. But is the child born poor?
The author of this paper believe there is no child who born poor or rich, she/he
acquires poverty from the family circumstances. As also indicated in UNDP

(1997) the deprivation of the lives that people (the children) lead is the
manifestation of poverty.
Understanding different dimensions or manifestations of poverty is very

important as income alone disguises the grinding nature of poverty.
Understanding the manifestation of poverty is also very important in looking for
the determinants of poverty. It is, fundamentally, by attacking the determinants
of poverty that we can improve the situation of people in poverty. But income is
always there as ‗transistor‘. My understanding of income in the study of poverty
is analogues to the focal point of concave mirror28. Like the focal point of a
concave mirror, analysis of the determinants (object/ sources of poverty) and the
real image (manifestation of poverty) meet at or get connected through income
(focal point).
Looking into determinants of poverty, though fundamentally important, is not the

objective of this paper, instead this paper concentrates on the significance of
income poverty and inequality in hampering child survival, nutrition and
education in developing countries, which was indicated in the End-decade Report
of the Secretary-General of the United Nations (2001), as one of the single most
important hindrances to achieve the World Summit Goals for children.
Now which measure of income poverty to use?. The World Bank suggest that
when estimating poverty world-wide, the same reference poverty line has to be
used, and expressed in a common unit across countries. For the purpose of global
aggregation and comparison, the World Bank uses reference lines set at $1 and $2
per day in 1993 Purchasing Power Parity (PPP)29 terms. Accordingly the World
Bank estimates that in 1999 1.2 billion people world-wide had consumption levels
below $1 a day. This measurement is reflected in the target embodied in the
Millennium Development Goals- for reduction of poverty. It reads-„Halve, between
1990 and 2015, the proportion of people whose income is less than one dollar a day.‟
Therefore, percent of population below $1 a day, poverty gap (depth of poverty)

at $1 a day, squared poverty gap and the Gini Index, are to be our measures of
income poverty and inequality in subsequent analysis.
28
One can see the property of concave mirror from any high school physics book: or
http://www.physicsclassroom.com/Class/refln/reflntoc.html
We have two rules of reflection for concave mirrors:
1. Any incident ray traveling parallel to the principal axis on the way to the mirror will pass through the
focal point upon reflection.
2. Any incident ray passing through the focal point on the way to the mirror will travel parallel to the
principal axis upon reflection.
29
PPPs measure the relative purchasing power of currencies across countries .

4.6.3 The effects of income poverty and inequality on child wellbeing-a review
We have already seen the close link of poverty and child wellbeing indicators
from theoretical and methodological point of view. Child wellbeing may be
considered as the very vivid manifestation of poverty. There are two important
questions emerge at this point. Why is poverty highly linked to child wellbeing?
Is the susceptibility of children to poverty the same for all developing countries?
Children are a particularly vulnerable group among the poor because their
welfare hinges on the resources of their parents. Children in poverty are at higher
risk of a host of developmental problems. They are far more likely to be of low
birth weight due to the poor health status of the mother and inadequate prenatal
care; they have higher rates of childhood morbidity and mortality; and they
continue to be exposed to unsafe environments and conditions that pose
additional risks (Bradley and Whiteside (1997), cited in Trudy Harpham (2002)).
Children who are raised in poverty experience more than the simple stress and
strains of living on the margin. The developmental consequences restrict both
their cognitive and physiological growth (Lindsey,1995).
When poverty spreads and deepens the risks of contracting respiratory infections,
diarrhoea, measles and other illnesses that commonly kill children or undermine
their physical, psychosocial and cognitive capacities increase. Impoverished
children become transmitters of poverty- as parents- to the next generation. In a
vicious circle, malnourished girls grow up to become malnourished mothers who
give birth to underweight babies (UNICEF, 2000).
Rowntree (cited in World Bank 2001), classifying his sample into three groups
ranging from poorest to richest, found that the mortality rate was more than twice
as high among the very poor as among the best paid sections of the working
classes. Calculating infant mortality, he found that in the poorest areas one child
out of every four born dies before the age of 12 months. According to this
argument, there is strong but negative relation between income and infant
mortality.
Based on their recent study done in Russia, Jensen and Richter (2001), discovered
that many of the differences in health-related behaviors during pregnancy
between rich and poor women are related to the use of inputs (calories, protein
and vitamins) which must be purchased. They argue that given the existing
scientific evidence, nutritional deficiency during pregnancy, especially during
periods of rapid cell division and differentiation, may lead to permanent
underdevelopment of vital organs and impaired health in adult life.
Shapiro and Tambashe (2001) reported that increased economic well-being

translates into greater investments in children‘s education for both females and
males. However, improved economic status does not necessarily result in reduced
gender differences in school outcomes.

4.6.4 Poverty and inequality Vs. progress in child wellbeing indicators

during the decade
First let us look at the association of poverty and inequality and the status of
developing countries‘ child wellbeing indicator by the end of the millennium. The
following correlation matrix (table-12), which was constructed after graphical
analysis and checking for outliers, depicts that the status of developing countries
in terms of absolute level of U5CMR, prevalence of malnutrition among under 5
children, NER-primary education– both total and for female child- are highly
significantly related to the level of poverty measured in poverty head count index,
poverty gap and squared poverty gap (p< 0.01), except for prevalence of
malnutrition vs. squared poverty gap (p<0.05).
However, there is no significant correlation between the Gini Index and the
absolute level of child wellbeing indicators by the end of the decade, except for
the negative and significant correlation with prevalence of malnutrition rate (% of
under-fives underweight (1995-2000) at p<0.05. This looks very strange. Normally,
this inverse relation is not expected. One might expect a higher prevalence of
malnutrition wherever higher inequality exists. What could be the reason(s) for
such unusual association?
Table 12 Correlation matrix of status of child wellbeing indicators by the end of 2000
Vs. poverty and inequality measures during the decade (1990-2000.)
% of
population Poverty Squared Gini Index
below $1 a gap at $1 a Poverty (different
day:1990- day (%)- gap 1990- year
Child wellbeing Indicators 2000 1990-2000 2000 b/n1990-99)
Under-5 mortality rate 2000 0.78** 0.75** 0.72** 0.12
N (valid count/countries) 66 66 66 72
% of under-fives underweight (1995-
2000) 0.56** 0.38** 0.29* -0.28*
Net Enrolment Ratio-Primary school:
Total (2000) -0.69** -0.62* -0.56** 0.07
Net Enrolment Ratio in Primary school-
Female (2000) -0.67** -0.58** -0.55** 0.10
** Pearson Correlation-significant at the 0.01 level (2-tailed);
* Pearson Correlation-significant at the 0.05 level (2-tailed);
Source: Calculated by the author based UNICEF (2002) UNESCO (2002) and WDI (2001) data base.
After a further search for the reasons that explain this strange result, it is learned
that there has been special measures taken to improve child wellbeing by
governments and private voluntary organization of some developing countries;
especially the upper middle income countries of Latin America and the Caribbean
and some Asian countries, where income inequality is as high as 0.65 Gini Index.

For example, the World Bank report (2002) indicated that Mexico has achieved
substantial improvements in the educational attainment and health of its poor
citizens through its „Progresa‟ program, which it launched on its own, without
donor support. And this was later emulated in a number of other countries, with
Bank advisory and financial support.
When we look at how poverty and inequality have been associated with the
progress in child wellbeing indicators, the picture is quite different. It is not
straight forward and strong like that of the association we have seen above for
end the decade status of child wellbeing indicators.
The only significant and negative correlation (Pearson) observed is the decade
reduction of U5CMR with the level poverty― measured in all three methods
(p<0.05). The correlation of decade reduction of prevalence of malnutrition
among under 5 with poverty index is significant only at 10% level of significance.
Although these two correlation coefficients (association on straight line) imply
that wherever poverty index (% of people below $1 a day) was high, the chance of
reducing U5CMR and prevalence of under 5 malnutrition was very low; the
variations, the patterns and the general tendencies of associations are best
visualized in the following graphs.
It is conspicuously seen from the graph (fig.-17) that there was very high variation
in progressing towards the Summit goal of reduction of U5CMR, among
developing countries with the same level of poverty (both in terms of poverty
index and poverty gap). This is specially observed when poverty, under both
measurements, is relatively at low level. After poverty index crossed 40 percent
and poverty gap passed 20 percent, although only a few countries seen then after,
we can see that the pattern is almost straight line. This non-uniform pattern,
which is neither very straight nor logarithmic; neither quadratic nor exponential,
is challenging for functional transformation and interpretation. As the tendency
become more straight line as the level of poverty increases, the best functional
association between decade reduction of U5CMR and poverty index and poverty
gap found to be simple linear. We will see in the next section (Chapter V) the
significance of poverty in contributing to the failure of developing countries to
attain the Summit goal of reduction of U5CMR along with other factors.
When we investigate the pattern and tendency of association of poverty index and
poverty gap with the decade reduction of prevalence of under 5 malnutrition, we
can see quite different and relatively inconsistent picture (fig.- 18). Although the
four West Africa countries (Mali, Niger, Nigeria and Sierra Leone) are seen to be
at the extreme right side of the graph in both cases; their location become extreme
and out of the chain when we use poverty gap as measure of poverty.

Fig.-17. Scatter plot of decade reduction of under -5 child mortality rate vs. poverty
index and poverty gap during the decade (1990-2000)
60
Indonesia
Korea, Rep. Ecuador Bangladesh
Turkey
40 Brazil Lao PDR
El Salvador
Nepal
Guatemala
Dominican R..
Panama
20 Sri Lanka Madagascar Gambia

Niger
Venezuela
Colombia Mozambique
Ethiopia Lesotho
Turkmenistan Mali
Armenia Nigeria
Georgia Mauritania
Tanzania
0 Rw anda Zambia
Uzbekistan
Côte d’Ivoire
Kazakhstan Cameroon
South Af rica
-20Algeria Kenya
-40
0 20 40 60 80
% of population below $1 a day:1990-2000
60
Indonesia
Turkey Bangladesh
40 Brazil
Bolivia Honduras
Nepal
Guatemala
Dominican R..
Costa Rica
India
Ghana
Sri LankaChina
20 Namibia
Madagascar Gambia Niger
Mozambique
Colombia
Ethiopia Lesotho
Turkmenistan Mali
Senegal Burkina Faso
Armenia NigeriaSierra Leone
Georgia TanzaniaMauritania Central Af rican R.
0 Rw anda Zambia
Côte d’Ivoire Cameroon

South Af rica
Algeria
-20 Kenya
-40
0 10 20 30 40
Poverty gap at $1 a day (%)- 1990-2000
Source: Graph constructed by the author based on UNICEF (2002) and WDI (2001) data base

As we can see from the figure below (fig.- 18), the association between decade
reduction of under 5 child malnutrition rate and poverty index tends to be more
logarithmic; while the second (with poverty gap) is linear if we remove the four
West African countries. But as these countries are from one sub-region with high
population it is difficult to exclude all as outliers. Given this pattern we will see
in the next chapter (chapter V) how this association can be explained using
different models along with other factors.
Fig.-18. Scatter plot of decade reduction of under -5 malnutrition rate vs. poverty index
and poverty gap during the decade (1990-2000)
60
Dominican R..
Chile Botsw ana
Tunisia Mexico
Peru
Jamaica
40Uruguay BoliviaVenezuela
Guatemala
Jordan Pakistan
Brazil
20 Costa Rica Bangladesh
Ghana Nigeria
Mali
Sri Lanka
Egypt Senegal Niger
Sierra Leone
0Algeria
Trinidad &Tobago
Zimbabw e Madagascar
-20 Honduras
Paraguay
Yemen
-40
0 20 40 60 80
60
Dominican R..
Chile Botsw ana
Tunisia Mexico
Peru
Jamaica Colombia
40
Uruguay Bolivia Venezuela
Thailand
Indonesia Pakistan
Brazil
20 Bangladesh
Ghana NigeriaMali
Sri Lanka
Egypt Senegal Niger
Sierra Leone
Algeria
0Trinidad &Tobago
Zimbabw e Madagascar
-20 Honduras
Paraguay
Yemen
-40
0 10 20 30 40
Source: Graph constructed by the author based on UNICEF (2002) and WDI (2001) data base

On the other hand, the investigation of the pattern of association between

progresses in primary education- measured in NER both for total and female
child- and level of poverty (with different measurement methods) reveals some
other unique pictures (see figure 19 & 20 below). The association of progress in
NER-total vs. poverty index seems to be linear except for Burkina Faso and Niger.
The unique picture is that there are two chains of association. Although the upper
group countries are mostly SSA, except for Bangladesh, Colombia and Morocco;
the lower group is a mix of different regions and different income groups. Thus, it
was not possible to figure out the factor(s) account for these divisions. On the
other hand the second association― progress in NER-total vs. poverty gap― seen
to be more consistent and follow linear pattern, except for the three West African
countries.
Fig.-19. Scatter plot of progress in total NER –primary education vs. poverty
50
Côte d’Ivoire
40Morocco Burkina Faso
Senegal
Colombia
30 Niger
Bangladesh
20
Thailand Brazil Mozambique
Ghana
10 Egypt Bolivia
Costa Rica Madagascar
Lesotho Central Af rican R.
Chile
South Af rica Venezuela
Paraguay
0Georgia
Indonesia Tanzania Namibia
Kenya
Botsw ana
-10
Nepal
-20
0 10 20 30 40 50 60 70
50
Côte d’Ivoire
40
Morocco Burkina Faso
Senegal
Colombia
30 Niger
Bangladesh
20
ThailandBrazil Mozambique
Panama Ghana
10Egypt Bolivia
Algeria Madagascar Central Af rican R.
Mexico Lesotho
South Af rica Venezuela
Georgia
0
Indonesia
Tanzania Namibia
Kenya
Zimbabw e ana
Botsw
-10
Nepal
-20
0 10 20 30 40
Source: Graph constructed by the author based on UNESCO (2002) and WDI (2001) data base

Unlike the association of progress in total NER-primary education vs. poverty

index, the association of progress in female NER-primary education vs. poverty
index is neither linear nor consistently follow certain type of function. But the
association of female NER in primary education vs. poverty gap is similar with
that of total NER vs. poverty gap. i.e. more linear and correlated negatively, with
the exception of the three West African countries.
Fig.-20. Scatter plot of progress in female NER –primary education vs. poverty
80
Morocco
60
Burkina Faso
Senegal
Niger
40 Bangladesh
Colombia
20 Ghana
Egypt
Algeria Bolivia
Central Af rican R.
Paraguay Nepal
Georgia
0 IndonesiaAf rica
South
Tanzania Lesotho
Kenya Namibia
Botsw ana
-20
0 10 20 30 40 50 60 70
80
Morocco
60
Burkina Faso
Senegal
Niger
40 Bangladesh
Colombia
20 Ghana
Egypt
Tunisia Bolivia
Panama
Central African R.
Nepal
Venezuela
South
0 Africa Lesotho
Tanzania
Kenya Namibia
Zimbabw e ana
Botsw
-20
0 10 20 30 40
Source: Graph constructed by the author based on UNESCO (2002) and WDI (2001) data base

Analysis of both graphical association and statistical correlation reveals that there
is no clear pattern of association /correlation between progress in child wellbeing
indicators and income inequality- measured in Gini Index, except for the negative
sign of Pearson correlation coefficient with regards to progress in female child
NER-primary education (r=-0.12), which implies that the higher the inequality –
the less chance for girls to go to school as compared to boys.
Overall, all the analysis indicate that the role of poverty and inequality in
affecting the progress of developing countries in child wellbeing indicators is not
prominent and consistent. This is probably due to the existence of other factors
which explain the variation in the rate of progress. We have seen quite a lot
already. But we have not seen yet the relative importance of each and every
variables and extent of their contribution in retarding or fostering the progress.
This is what we going to look at it in next chapter (Chapter V) to come to the
conclusion.

V. Determining the Determinants of Progress in Child

Wellbeing
“There is no task more important than building a world in which all of our children can
grow up to realize their full potential, in health, peace and dignity” (Kofi Annan,
Secretary-General of United Nations)
We have already seen the effect or association of macroeconomic performance,

government budget allocation, foreign aid/finance, and poverty on/ with child
wellbeing. Before we proceed to regression analysis of child wellbeing indicators
against these variables let us briefly see the importance of other variables
indicated on the schematic framework of the theoretical construct (fig.-7, pp)
before bringing them in- as control variables.
5.1 Overview of the other contributing factors affecting child wellbeing
5.1.1 Prevalence of HIV/AIDS and domestic conflicts:
Children and young people are at the centre of the HIV/AIDS epidemic. Young
people are particularly susceptible to HIV infection as they contract HIV through
mother child transmission, breastfeeding- of HIV infected mother, use of non-
sterilized piercing and cutting materials including syringes in health service
system of developing countries. HIV/AIDS has created a global orphan crisis, as
more and more adults with children die from AIDS, especially in sub-Saharan
Africa. The impact of HIV/AIDS on children is complex and multi-faceted, with
the social costs both high and long term. Overall, AIDS is increasing the number
of vulnerable, malnourished, poorly socialized, and uneducated young people,
which in turn heightens the prospect of social instability. As parents and other
family members become ill, children take on greater responsibility for income
generation, food production, and care of family members. They face decreased
access to adequate nutrition, basic health care, housing, and clothing. Fewer
families can afford to send their children to school, with young girls at particular
risk of being denied an education (Children on the Brink 2002, A joint
USAID/UNICEF/UNAIDS Report).
―The pandemic of HIV/AIDS is unraveling decades of gains in child survival and

development, especially in sub-Saharan Africa. The disease is leaving millions of children
orphaned as it kills teachers, health workers and other professionals who maintain and
operate the vital infrastructure of society‖ (Report of the Secretary General of U. N, 2001).
With regards to domestic conflict the End-decade Report of the Secretary General
of the United Nations depicted the unfortunate circumstances of the decade
despite the news at the beginning of the decade, when the World Summit for
Children was held. At the time of the Summit, it was end of the cold war and this
gave high hopes for a peaceful world, in which resources squandered in military
expenditures might be available for development purposes.

―Unfortunately”, the Secretary General Report (2001) described, “the decade since the
Summit has witnessed unprecedented levels of ethnic conflicts and civil wars, in which
children and women have become either direct targets or collateral victims. Perhaps more
children have suffered from armed conflicts and violence since the Summit than at any
comparable period in history.‖
A recent empirical study conducted in Angola reveals a significant disadvantage

of children residing in parts of the country that had been most affected by the
fighting in terms of a lower level of immunization and higher level of chronic
malnutrition among children (Agadjanian and Prata, 2003)
5.1.2 Governance and civil liberties:
The link between democracy and development has been under debate for some
time. One set of arguments states that democracy is not conducive to
development, interpreted as either economic growth or as improvements in
quality of life (Leftwich, 1993). This position, was based on the developments in
south Asia and East Asia, where rapid economic progress has taken place within
authoritarian regimes in these regions. However, there a consensus in recent years
that in a country where political freedom and civil liberties are low there is a low
level of civil society and other stakeholders‘ initiatives and involvement in
community development processes. Subsequently the benefit to the children
subdued. Moreover, bad governance and lack of civil liberties will lead to civil
un-rest & political instability, which leads to misuse or devastation of resources
and services available to children.
A statistical exploration of Ersson and Lane (1996) depicted the existence of robust
relationship between democracy (measured in political freedom and civil liberties
of Freedom House Index and Gurr Index ) and human development (measured in
the Human Development Index) and Physical Quality of life Index.
Boone‘s (1996) findings, and the findings of Kosack (2003), which were already
cited in section 4.5 of this paper, depict the fundamental role of civil liberty and
political freedom in reducing infant mortality rate and for effectiveness of
development aid, respectively. Kosack (2003) emphasized that aid is not only
ineffective but also possibly harmful in autocracies.
5.1.3 Levels of literacy of mothers
It is widely believed that illiterate parents lack access to crucial information, and
subsequently unable to optimally feed and care for their children. Illiterate
parents cannot appreciate the importance of learning to send their children to
school and can not support children in their learning process.
The world Bank Research Report „Engendering Development: Through Gender Equality
in Rights, Resources and Voice‟ (2001) emphasized the importance of mother education as
follows. “Mothers‘ illiteracy and lack of schooling directly disadvantage their young

children. Low schooling translates into poor quality of care for children and then higher
infant and child mortality and malnutrition. Mothers with more education are more likely
to adopt appropriate health-promoting behaviors, such as having young children
immunized. As with mothers‘ schooling, higher household income is associated with
higher child survival rates and better nutrition.‖
Supporting these conclusions there are many careful analyses of household

survey data that account for other factors that might improve care practices and
related health outcomes. Tharakan and Suchindran (1999) reported mothers‘ level
of education as one of the determinants of child malnutrition in Botswana. A
study conducted in Nigeria to assess the cause of malnutrition revealed that 66.1%
of malnourished and 57.7% of severely anemic children found to be belongs to
illiterate mothers (Abidoye, R.O., 1999).
5.2 Analysis of determinants
5.2.1 Basic assumptions for building the models
The following assumptions were employed to analyze for major intervening

variables (macro level determinants) that hindered or fostered progress in child
wellbeing indicators.
a) The effectiveness of developing countries endeavors to bring about significant

change in child wellbeing during the last decade depends on a number of
endogenous and exogenous factors. Among these economic growth, foreign
aid, private capital flows; budget allocation by central government of
developing countries for different sectors, debt service paid by developing
countries to creditor countries, the level of poverty, overall political freedom
and civil liberty status, political stability (level of conflict), HIV/AIDS
pandemic, level of inflation, and mothers‘ literacy level considered to be the
major intervening variables.
b) Child wellbeing is a fundamental human development indicator and it
depends not short term (a year or two) but on medium term (a decade)
economic phenomena and long term (trend of) economic growth for 2-3
decades.
c) The effect of aid and private capital flows on child wellbeing is subject to
increasing or possibly diminishing marginal returns30.
d) The effect of long term economic growth on child wellbeing is subject to
increasing marginal returns or possibly diminishing marginal returns.
e) Thus, progress in child wellbeing ((a)reduction in under 5 child mortality rate
(RMR), (b) reduction of prevalence of under five malnutrition (RNR),
(c1)improvement in Net Enrolment Ratio –total, for primary education (NERt)
and (c2) Improvement in female child Net Enrolment Ratio for primary
education(NERf)) during the decade (1990-2000) is a function of:
30
Collier and Dollar (2002) also used the assumption that “aid is subject to diminishing marginal returns”.

a. The level of long term (1960-90) economic growth (Gl)

b. The level of economic growth (Gd) during the decade
c. The level of Inflation Rate during the decade (Ir)
d. The level of central government expenditure allocated to Health (Bh),
to Education (Be) and to Defense (Bd) during the decade,
e. The level of Aid/GNP ratio during the decade (Aid)
f. The level of gross private capital flows (% of GDP) during the decade
(Pc)
g. The level of total debt service (% of exports)- during the decade (Ds)
h. The level of poverty index (pi), poverty gap (Pg), and income
inequality/ Gini Index (Ix) during the decade,
i. The level of female adult literacy rate at the beginning of the decade
(1990) (Lf)
j. The level of Prevalence of HIV among male and female youth (15-24
year) during the decade (HIV)
k. The level of political instability/domestic Conflict (Dc) during the
decade.
l. The status of overall political freedom and civil liberty of the people in
developing countries (Fr) during the decade
After checking for how each and every factor associated with the dependent
variables (child wellbeing indicators) through scatter plot and curve estimation
facility of SPSS (Statistical Package for Social Scientists), different linear regression
models were applied to determine significance and the relative importance of
each factor after. The model was developed after required transformation of the
variables to logarithmic and/or quadratic functions were done.
5.2.2 Determinants of under 5 child mortality rate reduction
The linear model for reduction in U5CMR (RMR) is given by:

RMR = c + b1Gt + b2(Gt)2 + b3Gd + b4 (Log( Ir)) + b5Bh + b6Be + b7Bd + b8Aid+
b9(Aid)2 + b10 Pc + b11(Pc)2 + b12Ds + b13Pi + b14Pg + b15Lf + b16HIV+
b17(Log(Dc)) + b18Fr
Here we have to note that the coefficients on the quadratic, b2, b9, b11 will pick
up any diminishing or increasing returns to long term growth, aid and private
capital flows respectively. The coefficients may be positive, negative or zero
depending upon the level of contribution of each factor to the reduction of
U5CMR. Thus, both the sign and the significance of each coefficient constitute the
tests of the hypotheses.
Table-13 presents the ordinary least square (OLS) results for the estimation of
coefficients of explanatory variables on the data set used to estimate the effect of
the variables on progress in reducing U5CMR during the decade. Overall the
model significantly explains the variation for reduction in U5CMR (F=11.181,
P<0.001). Adjusted R2 of 0.782 indicates that the model explains at least 78 percent
of the variation in U5CMR reduction.
The most significant variable in the regression are Poverty gap at $1 a day (%),
Prevalence of HIV among male and female youth (15-24 year), weighted Conflict
Index (logarithm transformed), overall Freedom Status31, and square of long term
GDP per capita growth rate, which are significant at the 1 percent level.
The sign of these highly significant variables is negative except for Freedom
Status and square of long term GDP per capita growth rate. The sign of the
coefficients and level of significance imply that depth of poverty, prevalence of
HIV, and Domestic Conflict were found to be the major stumbling blocks in
developing countries to fulfill the right of children and thereby meet the Summit
Goals. On the other hand presence of political freedom and civil liberties, where
it exist, has been contributing significantly and positively to the reduction of
U5CMR. Conversely, this implies that lack of political freedom and civil liberties
has significantly and negatively affected efforts to reduce U5CMR. Countries in
which the population at least partly experienced political freedom and civil
liberties were able to reduce child mortality, as compared to repressive regimes, at
least by 11 percent (one third of the Summit Goal) assuming other factors to be
constant. This is in harmony with findings of Boon (1996) who reported ‗30%
lower infant mortality rate in liberal democratic regimes than most repressive
ones.‘
The long term GDP per capita average annual growth rate (1960-90) and its
square- (Gt)2 come-out with different signs and different level of significance; -
2.02 (P>0.1) and 1.39 (P<0.01) respectively. This implies there is increasing
marginal returns to long term economic growth. And the long term growth
significantly and positively contributed to the reduction of child mortality rate
when it was greater than 1.45 percent, which is the ratio of the coefficients.
However, GDP growth during the decade (1990-2000) is seen contributing slightly
negatively for U5CMR reduction. But the contribution is insignificant to make a
conclusion. Therefore we can generalize that attaining a modest growth over the
long term, not simply over a decade, is a necessary condition to reduce child
mortality rate.
Other factors which proved to be positively and significantly influenced reduction

of U5CMR is central government expenditure allocation to education sector
during the decade (b= 0.47, P<0.05). This implies there is about 0.5% reduction of
child mortality rate for 1 percent increase of government budget allocation to
education.
31
According to Freedom House, countries whose combined averages for political rights and for civil
liberties fall between 1.0 and 2.5 are designated "Free"; between 3.0 and 5.5 “Partly Free”; and between 5.5
and 7.0 “Not free.” This was transformed to dummy variable „overall all freedom status‟ classification by
recoding „Free and Partly Free‟= 1; and „Not Free‟ =0

Table-13 Ordinary Least Square (OLS) estimators of explanatory variables alongside
U5CMR reduction during the decade (1990-2000.)
Dependent Variables : U5CMR -Decade reduction (%) 1990-2000
Coefficients Std.
Explanatory Variables (B) Error t
(Constant) 34.45* 14.52 2.37
GDP per capita average annual growth rate (%) 1960-90 (Gt) -2.02 1.36 -1.49
(Gt)2 1.39** 0.19 7.29
GDP per capita average annual growth rate (%) during the decade
(Gd) -0.12 0.55 -0.21
Log of inflation rate during the decade (Log Ir) -0.05 0.95 -0.06
Percent of central government expenditure allocated to Health
during the decade (Bh), 0.69+ 0.35 1.97
Percent of central government expenditure allocated to Education
during the decade (Be) 0.47* 0.22 2.18
Percent of central government expenditure allocated to Defense
during the decade (Bd), -0.13 0.21 -0.61
Aid to GNP ratio (%)- Annual Average during the decade (Aid), -0.30 0.67 -0.44
(Aid)2 0.02 0.03 0.71
Gross private capital flows (% of GDP) during the decade (Pc)
-1.12 0.98 -1.14
(Pc)2 0.01 0.05 0.14
Total debt service (% of exports) during the decade (Ds)
0.25 0.13 1.86
Population below $1 a day (%):1990-2000(Pi) 0.49 0.27 1.85
Poverty gap at $1 a day (%)- during the decade (Pg), -1.21** 0.44 -2.73
Female adult literacy rate by the beginning of the decade (1990) (Lf) 0.02 0.08 0.32
Prevalence of HIV among male and female youth (15-24 year) by
end of the decade (HIV) -3.11** 0.33 -9.30
Log of weighted conflict index during the decade (Dc) -3.57** 1.35 -2.65
Overall Freedom Status -dummy (Free and Partly free= 1; Not
free=o) 11.38** 3.50 3.25
R Square =0.859
Adjusted R Square, =0.782
Durbin-Watson = 1.924
Model significance (ANOVA) F=11.181**
Valid count 51 countries
NB: Collinearity Condition Index Exceed 30 only for one explanatory variable
Standard Residual Mean= -0.19, and it is checked to be normally distributed
** Significant at the 0.01 level; * significant at the 0.05 level; and + significant at the 0.10 level
Although education budget does not serve child health care, the result depicts
how multipurpose the investment in education is. As has been advocated by
public health professionals, to meet the Health- for-All Policy32, education,
particularly primary education, is one of the determinants of primary health
32The Health-For-All policy, which was adopted in 1977 and launched in 1978, has been a
common inspirational goal since its inception. (http://www.who.int/archives/hfa/history.htm)

care33.. We can also see that central government expenditure allocated to Health
during the decade is also nearly significant (b= 0.69, P<0.1). This confirms that
those governments allocated adequate budget for health have been able to reduce
U5CMR significantly. Allocating 1 percent more budget mean decreasing child
mortality nearly by 0.7 percent.
The negative sign of the coefficient of Inflation and Government Expenditure

Allocated to Defense is worth to note. Although statistically not significant both
have contributed negatively to the effort of reducing U5CMR.
Aid and aid squared appear with different sign and size of coefficients, but both
are non-significant (-0.3 and 0.02 respectively). Although not significantly
different from zero the coefficients on aid depict that there is increasing returns to aid,
and aid has been contributing slightly positively after the Aid to GNP ratio exceeds 15
percent. This suggests that for aid to induce positive changes or bring about
significant reduction in child mortality rate, the allocation should have been at
least 15% of GNP, provided that other conditions are conducive. This quite
different from, although not completely contradictory to the World Bank report
(1998) that said, ―With sound country management, 1 percent of GDP in assistance
translates into a 1 percent decline in poverty and a similar decline in infant mortality‖.
The pattern and effect of Private Capital Flows on the progress of U5CMR
reduction is similar to that of aid. But the amount of Private Capital Flows (as %
of GDP) needed to have a positive contribution seems very high. It has to be about
112 %, which may not be possible to realize. Since the coefficient is not significant
this needs some further investigation to come to a conclusion.
Similarly, Total Debt Service (measured as % of exports) during the decade is

found to be affecting the progress of U5CMR reduction positively. The
implication of the sign is that countries paying their debt to their creditors were
not in the group where child mortality was getting worse during the decade.
Although some countries with weak economy such as Zambia, Uganda, Burundi,
Algeria were paying higher amounts of their export for debt service, most of the
countries paying higher proportion of their exports for debt service are of course
those economically strong and at better position in terms of child mortality rate at
the beginning of the decade; for example Argentina, Brazil, Indonesia, Morocco,
etc,.
The positive sign of the coefficient of Poverty Index (percent of population below
$1 a day) during the decade is not expected; but not a total surprise either. When
we look further on the effect of poverty measured in terms of Poverty Gap at $1 a
33
Primary Health Care (PHC) originally emerged from the analysis of what was happening in the
health sector in the different regions in the 70s. The PHC movement has been responsible for a
tremendous ideological shift: A shift from curative to preventive care, from hospital care to
community care and public health, and from urban to rural health care. Furthermore, it linked
health to its determinants, often outside the health sector, and it emphasized the responsibility of
people for their own health, through the decentralization of health services and political power
(Tarimo, 1997).
day, it is negatively and significantly accounts for reduction of U5CMR during the
decade. This is an important feature for planning as well. It is the Depth of
Poverty which is detrimental to child survival rather than the simple head count
index. The Millennium (International) Development Goals, which target to reduce
the percent of people living below $1 a day (poverty head count index) by 50% by
the year 2015, will not bring significant change in reducing child mortality if the
poverty gap is not narrowed down.
5.2.3 Determinants of under 5 child malnutrition rate reduction
The linear ‗best–bet‘34 model for reduction of prevalence of under 5 malnutrition

(RNR) is given by:
RNR = c + b1Gt + b2Gd + b3Bh + b4Bd + b5 (Log(Aid) )+ b6(Log Pc) +
b7(Log (Pi))+ b8Lf + b9Fr
Here we have to note that the coefficients of the log transformed variable need to
be interpreted differently. In such a semi log model a unit change in the log
transformed independent variable will not always result in similar changes in the
dependent variable. As the independent variable is getting larger, the rate of
change of dependent variable is getting smaller. i.e. Dependent variable is
decreasing more slowly (at decreasing rate) than independent variable or vise
versa. Of course that is why in such a case Maddala (1992) and Mukherjee et.al
(1998) advice the use logarithmic transformation as an appropriate statistical tool
to explore linear association. The coefficients may be positive, negative or zero
depending upon the direction and level of contribution of each factor to the
reduction of prevalence of under 5 malnutrition.
According to table-14, that presents the OLS results for the estimation of
coefficients of explanatory variables; the model only slightly significantly explains
the variation in reducing prevalence of under 5 child malnutrition (F=2.149,
P<0.05). Adjusted R2 of 0.2182 indicates that the model explains only about 22
percent of the variation in reducing prevalence of under 5 child malnutrition.
Although the model is statistically valid to forward conclusions (F is significant at

0.05), a lot need to be further explored to explain the variation of prevalence of
under 5 child malnutrition in developing countries. This has to do probably with
variation at household level such as family size, food type, breast feeding culture,
etc., which is not possible to capture at country aggregate level.
34
It was labeled „best-bet‟ because this is the model found to be significant (in F-test) and with unbiased
estimation of the coefficients and minimum residuals; after a series of models tested to illustrate the
situation.

Table-14 OLS estimators of explanatory variables alongside Reduction of Prevalence
of Under 5 Child Malnutrition during the decade (1990-2000.)
Dependent Variable: Decade reduction of prevalence of malnutrition (%)
Coefficients Std.
Explanatory Variables (B) Error t
(Constant) 32.44+ 19.24 1.69
GDP per capita average annual growth rate (%) 1960-90 (Gt) 1.85 2.21 0.83
GDP per capita average annual growth rate (%) during the
decade (Gd) 1.75 1.27 1.37
Percent of central government expenditure allocated to Health
during the decade (Bh), 0.72 0.87 0.82
Percent of central government expenditure allocated to Defense
during the decade (Bd), -0.66 0.52 -1.27
Log of Aid to GNP ratio (%)- Annual Average during the
decade
(Log Aid) -4.56+ 2.43 -1.88
Log of Gross private capital flows (% of GDP) during the decade
(Log Pc) 3.67 4.11 0.89
Log of poverty index (% of population below $1 a day):1990-
2000 (Log Pi) -3.45+ 2.18 -1.58
Female adult literacy rate by the beginning of the decade (1990)
(Lf) 0.19 0.18 1.07
Overall Freedom Status -dummy (Free and partly free= 1; Not
free=o) 4.77 8.16 0.58
R Square =0.409
Adjusted R Square, =0.218
Durbin-Watson =2.182
Model significance (ANOVA) F=2.149*
Valid count = 37 countries
NB: Collinearity Condition Index: below 10 except for one explanatory variable
Standard Residual Mean= -0.09, and it is checked for normal distribution
*significant at the 0.05 level; and + significant at the 0.10 level
Despite the limitation of the model, we can see that the long term (1960-90) GDP
per capita average annual growth rate (Gt), GDP per capita average annual
growth rate during the decade (Gd), percent of central government expenditure
allocated to health sector during the decade (Bh), log transformed gross private
capital flows (as % of GDP) during the decade (Log Pc), female adult literacy rate
at the beginning of the decade(Lf) overall Freedom Status–dummy (Fr) have
contributed positively to the intended goal-‗reduction of prevalence of under 5
child malnutrition‘. On the other hand central government expenditure allocated
to Defense during the decade (Bd), Aid to GNP ratio during the decade (log
transformed =Log Aid)) and log transformed poverty index (% of population
below $1 a day: 1990-2000 – (Log Pi)) have contributed negatively.

When we look into the level of significance only Aid to GNP ratio and Poverty
Index (both log transformed) have shown nearly significant effect (b=-4.56, P<0.1;
and b=-3.45, P<0.1 respectively.) Although a significance level of 0.1 is weak from
statistical validity point of view, the negative coefficient of poverty index implies that
poverty dismissed the positive contribution of aid. Thus to overcome the influence of
poverty and contribute positively to the reduction of prevalence of child
malnutrition, there should be some optimal level of aid allocation. However, as
the model explains only 22 percent of the variation it needs further micro level
research to come up with the more precise conclusion.
5.2.4 Determinants of improvement in primary education enrolment

We will see this in two models.
C1. Determinants of improvement in total Net Enrolment Ratio for primary
education (NERt)
C2. Determinants of improvement in Female child Net Enrolment Ratio for
primary education (NERf)
Among a series of model tested, the relatively most robust linear models for NERt
and NERf are given by:
NERt = c + b1Gt + b2Gd + b3(Log( Ir)) + b4Be + b5(Be)2 + b6Bd + b7Aid + b8Pc +
b9Ds + b10Pg + b11Lf + b12HIV+ b13(Log(Dc)) + b14Fr + b15Te90
NERf = c + b1Gt + b2Gd + b3(Log( Ir)) + b4Be + b5(Be)2 + b6Bd + b7Aid + b8Pc +
b9Ds + b10Pg + b11Lf + b12HIV+ b13(Log(Dc)) + b14Fr + b15Fe90
Here, Net Enrolment Ratio-Primary school-Total (1990) (Te90) and Net Enrolment
Ratio in Primary school- Female (1990) (Fe90) were introduced in the models
because each were found to co-vary with the respective dependent variable. The
coefficients on the quadratic, b5, will pick up any diminishing or increasing
returns to percent of central government budget allocation to education sector.
Table-15 presents the OLS results for the estimation of coefficients of explanatory
variables on the data set used to estimate the effect of the variables on progress in
improvement in total and female child NER-in primary education during the
decade.
Overall the model significantly explains the variation for both total and female
child NER-in primary education (F=8.517 (p<0.001); and F=4.578(p=0.001),
respectively.) The Adjusted R2 of 0.743 for total NER and 0.612 for female child
NER indicate that the model explains at least 74 and 61 percent of the variation of
progress towards universal primary education goal in total and female child
NER-in primary education correspondingly.

Table-15 OLS estimators of explanatory variables alongside Percent of Change in NER-
Primary Education over the decade (1990-2000)
Dependent Variables :
Progress in total Progress in female
NER-primary NER- primary
education education
Explanatory Variables (1990-2000) (1990-2000)
Std.
B Error B Std. Error
(Constant) 28.99 33.15 25.79 20.03
GDP per capita average annual growth rate (%)
1960-90 (Gl) 0.45 0.96 0.33 1.32
GDP per capita average annual growth rate (%)
during the decade (Gd) 0.77 0.51 -0.14 0.72
Log of inflation rate during the decade (log Ir) -2.54* 0.96 -1.49 1.41
Percent of central government expenditure allocated
to Education during the decade (Be) 0.96 0.72 0.84 1.01
(Be)2 0.04 0.02 0.03 0.03
Percent of central government expenditure allocated
to Defense during the decade (Bd) -1.40** 0.22 -0.63* 0.28
Aid to GNP ratio (%)- Annual Average during the
decade (Aid) 0.85+ 0.46 0.60+ 0.35
Gross private capital flows (% of GDP) during the
decade (Pc) -0.04 0.35 -0.64+ 0.37
Total debt service (% of exports) during the decade
(Ds) 0.03 0.13 0.18 0.18
Poverty gap at $1 a day (%)- during the decade (Pg), -0.16 0.18 -0.64* 0.27
Female adult literacy rate by the beginning of the
decade (1990) (Lf) 0.17* 0.08 0.02 0.14
Prevalence of HIV among male and female youth (15-
24 year) by end of the decade (HIV) -0.47 0.30 -0.55 0.45
Log of weighted domestic conflict index during the
decade (log Dc) -3.03* 1.30 -0.31 1.79
Overall Freedom Status –dummy (Fr) (Free and partly
free= 1; Not free=o) -14.74* 3.53 0.93 4.70
Net Enrolment Ratio-Primary Education: Total (1990)
(Te90)-‗co-variant’ -1.02** 0.12
Net Enrolment Ratio in Primary Education- Female
(1990) (Fe90)-‗co-variant’ -0.71** 0.17
R Square =0.842 =0.783
Adjusted R Square, =0.743 =0.612
Durbin-Watson =1.542 =1.837
Model significance (ANOVA) F=8.517 (p<0.001) F=4.578(p=.001)
Valid count =39 countries =34 countries
NB: Collinearity Condition Index: below 30 except for two explanatory variable
Standard Residual Mean= -0.4 and 0.07 respectively. Distribution is near to perfect
normal distribution.
** Significant at the 0.01 level; * significant at the 0.05 level; and + significant at the 0.10 level

Beside the co-variant (Net Enrolment Ratio-Primary Education at the beginning

of the decade (1990)) the progress towards the Summit Goal of Universal Primary
Education (change in total NER) in developing countries has been challenged by
central government expenditure allocation in favor of „Defense‟ (b= -1.4, p<0.01),
the level of inflation (b= -2.54, p<0.05), and the level of domestic conflict during
the decade (b= -3.03, p<0.03). The negative contribution of overall freedom status
(aggregate level of political freedom and civil liberties) to the progress in child
education is unexpected. A further exploration for this odd out come reveals that
this was associated with, among others, the disruption of public provision of
education within the countries in transition from communist and dictatorial
government system to multi party and free market economy system (UNESCO,
2002). When we look into the data, we can see that out of 28 developing
countries, where enrollment was worsened during the decade, most belong to
what Freedom House rate as „Free‟ and „Partly Free‟. These include, Georgia,
Kyrgyzstan, Botswana, Mauritius, Namibia, South Africa, Tanzania, Indonesia,
Korea-Republic, Mongolia, Philippines, Jamaica, Paraguay, Uruguay, Nepal and
Venezuela. A lesson to be drawn from this finding is that political freedom and
civil liberty alone is not a sufficient condition to improve child wellbeing.
Other factors that have been found to be influencing positively and significantly
the progress in total NER was ‗female adult literacy rate‟ by the beginning of the
decade (1990) ( b= 0.17, p<0.05). Although the significance is weak in statistical
terms, aid allocation (Aid to GNP ratio) is also seen to be influencing progress in
total NER considerably and positively (b=0.85, p<0.1).
Beside the sign of their coefficients, which shows a negative influence, poverty gap at $1
a day, prevalence of HIV among male and female youth, and gross private capital
flows had no significant impact on progress of total NER-in primary education. It is
also clear from the table that neither long term (1960-90) GDP per capita average
annual growth rate, nor GDP per capita average annual growth rate during the
decade had significant influence on the progress. However, the positive sign of their
coefficients is something to note. The same is true for central government budget
allocation for education sector.
The significant but negative coefficient of the co-variant depicts that countries
with lower total NER at the beginning of the decade have managed to progress
more, as also depicted in the following figure (fig-21).
The exceptional factors that were negatively and significantly influencing

progress in female children NER-in primary education include poverty gap at $1 a
day (b= -0.64, p<0.05) followed by central government expenditure allocation in
favor of Defense (b= -0.63, p<0.05); and although statistically weak the third factor
was private capital flows during the decade (b= -0.64, p<0.1). On the other hand,
nearly significant positive influence, on progress in female children NER-in primary
education, is seen from aid allocation (b= 0.6, p<0.1).

Fig.-21 Scatter plot of total NER at the beginning of the decade (1990/1) Vs. Progress in
total NER-in primary education during the decade. (1990-2000)
60
Côte d’Ivoire
Burkina Faso Chad Morocco
40
Tajikistan
Senegal Lao Colombia
PDR
Niger
Bangladesh
Togo
20 Argentina
Mozambique Thailand
Ghana Panama
Egypt
Central Af rican Rep. Viet Nam
Lesotho Mexico
Burundi South AfGeorgia
rica
0
TanzaniaSaudi Arabia Namibia Korea, Rep. of
Kenya
Kyrgyzstan
Nepal Myanmar
-20
Angola
-40
20 40 60 80 100 120
Net Enrolment Ratio-Primary school:Total (1990/1)
Source: Graph constructed by the author based on UNESCO (2002) data base
The discriminatory nature of poverty is only seen when measured in terms of

poverty gap (depth of poverty) not when measured in terms of poverty head
count index which was excluded from this model due to its less relevance to
depict the situation. Once again this illustrates that the major targeted Millennium
Development Goal of poverty reduction by 50 percent possibly gender insensitive
if it continues to measure poverty by the head count index.
The special influence of private capital flows on female children‘s access to

education also deserves particular attention. The effect can be partly attributed to
high level of female NER at the beginning of the decade in those countries able to
attract large size of private capital flows. The simple correlation coefficient depicts
there exist a weak correlation between private capital flows and female NER at
the beginning of the decade (r=0.221, p =0.085). While, the negative influence of
private capital flows on the progress in female children NER is higher (r= -0.328,
P= 0.028).
Of course, the effect of the level of female children NER at the beginning of the
decade, was already entered into the model as a control variable, and its effect
was partialled out by its coefficient. We can also guess that there might be other
traditional or religious factors compounding its influence. For example Saudi
Arabia, the strong traditional Islam state, where women are not entitled to
engage in public works, is at the pick of both high private capital flows, and one
of the countries where female NER –in primary education retrogressed during the

decade (fig-22). Beside Saudi Arabia, countries like Botswana, Namibia, Korea
Republic, Jamaica, Uruguay, etc, where progress in female children NER
retrogressed, but where private capital flow was high are not known for religious
influence on female education. Therefore, there is ample reason to believe that
private capital flows has negatively influenced progress in female children NER-
in primary education.
Fig.-22 Scatter plot of progress in female children NER- in primary education Vs.
Private capital flows into developing countries during the decade. (1990-2000)
80
Morocco
60
Burkina Faso
Senegal
Niger
40
Bangladesh
Togo
Colombia
20 Ghana Egypt Thailand Argentina
Algeria Nicaragua Bolivia
Tunisia
Central Af rican R.
Costa Rica
Kazakhstan Sw aziland Trinidad &Tobago
Paraguay
0 Georgia South Af rica Uruguay Jamaica Saudi Arabia
Korea, Rep.
Kenya Namibia
Kyrgyzstan Botsw ana
-20
0 2 4 6 8 10 12
Gross private capital flows (% of GDP, PPP)- Annual Average (1990-2000)
Source: Graph constructed by the author from UNESO (2002) and EDI (2001) data base
We can see from table-15 that GDP per capita average annual growth rate during
the decade and overall freedom status are found to be influencing the progress in
female NER in a different direction― from the way they were influencing
progress in total NER. With regards to other factors we can also see that they are
influencing progress in female children NER in the same direction and
insignificantly as they have been influencing progress in total NER.
Although the coefficient is found to be non-significant, GDP per capita average

annual growth rate during the decade had negative influence, while overall freedom
had positive influence on progress in female NER. This finding, although crude
and statistically invisible, implies that for female children the chance to benefit
from freedom was better as compared to the chance to benefit from economic
growth.

VI. Summary Conclusion

Children, although constitute the large part of population of developing
countries, their survival and development has been under several threats during
the last decade. The promise to reduce child mortality by 33 percent, prevalence
of malnutrition by 50 percent and creating access to primary education for all
children have been not only far but very far from being realized in many
developing countries, although few managed to achieve it. The situation of
children is very touching in some countries, where instead of progressing at least
by a faction of percentage to the Summit goals; they started moving
retrogressively against the survival and development of children.
Different factors found to be responsible for the retrogression and inadequate

progress. There are also a number of factors seen to be contributing positively for
the progress in child wellbeing. The resultants, the progress in child wellbeing,
thus depend on the extent to which the positive forces have overcome the
counteracting forces. In such a case it is not strange to find the contribution of one
positive factor possibly dismissed by much stronger negative force(s). For
example depth of poverty seems to dismissing the slightly positive contribution of
aid
The effects of each variable, whether it is positive or negative, is found to be not

the same across the child wellbeing indicators, except for consistency of sign in
most cases. As the result there is no single factor which is found to be affecting all
three child wellbeing indicators and female primary education with the same
level of significance. This hint at the need to design separate strategies to meet the
needs and fulfill the right of children, as there is no single solution which solve
the dismal situation of all the three major indicators of child wellbeing.
Despite the non-uniform influence of the different socio-economic circumstances

we have gone through, the most prominent factors that were seen significantly
affecting one or more child wellbeing indicators can be categorized into two.
The significantly negative forces include central government expenditure allocated in

favor of Defense, the depth of poverty ( poverty gap at $1 a day), the prevalence of HIV
among male and female youth (15-24 year) and, the level of political
instability/domestic Conflict during the decade. While the other contributors to
these negative forces include inflation and the level of gross private capital flows
(measured as % of GDP)-especially on progress on female children NER in
primary education. .
The only significant and consistently positive force is found to be the level of long
term economic growth (1960-90) followed by the status of overall political freedom and
civil liberty in developing countries except for its negative influence on progress
in total NER for the reason explained above. While the other positive contributors
include the level of share of central government expenditure allocated to health sector,

share of central government expenditure allocated to education sector, the level of female
adult literacy rate at the beginning of the decade (1990)
The level of Aid/GNP ratio during the decade tends to have a mixed
contribution. However, the tendency was more positive but conditional. It
depends on its level: i.e its contribution is more positive when allocation is on
average at least 15 percent of GNP, especially in its contribution to the reduction
of U5CMR; and also less responsive even seems negative when the influence of
poverty is not controlled.
The negative influence of private capital flow is bad news both for private
investors and for children in the era of globalization, when free market and
private capital movement is believed to be the only choice for development.
Whatever the means might be, development has to be for the betterment of
human wellbeing or at least neutral to human wellbeing. If it has negative
contribution in all dimensions, it is hard to accept, not simply as the best but as
one of the choice. It seems that the appeal for ‗Adjustment with Human Face‟, the
early work of Cornia and et al. (1987) published by UNICEF is not heard by many
countries and private capital owner. If this is continue to be the out come it is
difficult to accept IMF and World Bank orthodox prescription of structural
adjustment and liberalization of market regardless of the suffering of human
beings. If structural adjustment and liberalization is to improve the living
condition of the coming generation at outraged expense of the current children; it
is reckless inhumanity.
The presence of political freedom and civil liberties, where it exist, has been
contributing significantly and positively to the reduction of U5CMR. Conversely,
this implies that lack of political freedom and civil liberties has significantly and
negatively affected efforts to reduce U5CMR. Moreover, political freedom and
civil liberties has positive effect on female children NER in primary education.
The effect of poverty on progress in child wellbeing indicators, particularly

U5CMR reduction and progress in female child NER-primary education is more
observed when measured in terms of Poverty Gap at $1 a day. This implies that it
is the Depth of Poverty which is detrimental to child survival and female child education
rather than the simple head count index. The Millennium (International)
Development Goals, which target to reduce the percent of people living below $1
a day (poverty head count index) by 50% by the year 2015, will not bring
significant change in reducing child mortality if the poverty gap is not narrowed
down. The MDG of poverty reduction is also possibly gender insensitive if it
continues to measure poverty by the head count index.
In spite of introducing a number of control variables and testing under different

models, the negative, significant and persistent effect of central government
expenditure allocation in favor of defense on all dimensions of child wellbeing
indicators, implies that the government of developing countries misallocated the

resources at the expense of child survival and development or possibly misused the
resources and to use children as hostages and bargain with child mortality and
malnutrition and illiteracy to secure more funding for further misuse and personal gain.
To meet the needs and fulfill the right of children in developing countries:
a) There should be international pressure on government of developing

countries to reallocate its budget in favor of health and education from
defense; and international sanction on armament supply to developing
countries governments and any rebellion group opting for armed struggle. If
there is no change in this regard it is doubtful for the external funding to
bring about meaningful change in the lives of children.
b) Poverty reduction, HIV prevention and treatment, supporting peace and

stability and democratization process for political freedom and civil liberties,
which is found to one of the significant positive force for the progress in child
wellbeing during the last decade, should be the primary focus of any agency:
be it governmental or non-governmental organizations (NGOs); multilaterals
or bilateral funding agencies working or advocating for child wellbeing. It is
only through these integrated interventions that we can make the third world
at least hospitable place for children to survive and realize their full potential.
We have to be also cautious that to make the MDG target of reduction of
poverty by 50% more child responsive and female child sensitive, poverty
reduction should be measured in terms of reducing the depth of poverty
rather than the simple poverty head count index of $1 a day.
c) If aid is primarily intended for the reduction of poverty and sustainable

improvement of the wellbeing of people in developing countries there should
be some optimal level of aid allocation. For better/ optimal aid allocation
donors has to develop and apply Aid Allocation Index (AAI) taking into
account Population, Depth of Poverty, Child Wellbeing Index, Size of
Economy, and Skin Size (surface area) of developing countries- as part of the
global natural resources. Otherwise, as we have seen in this paper, aid will
not bring observable changes in overall development status of developing
countries in general and child wellbeing in particular.
d) There should be gender disaggregated child wellbeing impact assessment as a

fundamental criterion to allow or block any private capital flows, which are
dominantly foreign direct investments, into developing countries. Otherwise
we end up advocating for globalization and liberal economic system at
outraged expense of the children, especially female children in developing
countries.

Table- 16 Summary matrix: effect of different intervening variable on the progress of child wellbeing indicators during the decade (1990-2000)
Intervening variables Reduction Reduction of Progress in total Progress in female Overall

of U5CMR Prevalence of NER-Primary NER-Primary Influence
Malnutrition Education Education
1. The level of long term (1960-90) economic growth -/+** I + + + +*
2. The level of economic growth during the decade - + + -/+ +/-
3. The level of Inflation Rate during the decade - NA - - -
4. The level of central government expenditure allocated to +# + NA NA +
Health during the decade
5. The level of central government expenditure allocated to +* NA +I +I +/
Education during the decade
6. The level of central government expenditure allocated to - - -** -* -*
Defense during the decade,
a. The level of Aid/GNP ratio during the decade -/+I -/# + +# -/+I
7. The level of gross private capital flows (% of GDP) during -/+ + - -# -/?
the decade
8. The level of total debt service (% of exports)- during the + NA + + +
decade
9. The level of poverty index (% of people below $1 a day) + - NA NA -/+?
10. The level of poverty gap (at $1 a day) -** NA - -* -*
11. The level of female adult literacy rate at the beginning of the + + +* + +
decade (1990) (Lf)
12. The Prevalence of HIV among male and female youth (15-24 -** NA - - -/*
year) during the decade (HIV)
13. The level of political instability/domestic Conflict (Dc) -** NA -* - -/*
during the decade.
14. The status of overall political freedom and civil liberty of +** + -* + +*
the people in developing countries (Fr) during the decade
Number countries with valid data set and 51 37 39 34
included in the regression
N.B: - = negative influence/effect; += positive influence/effect, -/+ =mixed effect depends on the type of function and the level of the variable itself, -/+ = it
has negative at low level but positive at high level; I= increasing returns, **, *, # mean highly significant, significant and slightly significant influence or effect

Annex 1: The details of variables by type by sources.
Population Data
Total population (in 2000) USBC/IDB
Under 18 Population-2000 USBC/IDB
Under 15 Populations-2000 USBC/IDB
Under 5 Population-2000 USBC/IDB
Child Wellbing Indicators
Under-5 mortality rate 1960 UNICEF
U5M -Average annual rate of reduction (%)1960-90 Transformed
U5M- Average annual rate of reduction (%) 1990-2000 Transformed
U5M -Decade reduction (%) 1990-2000 Transformed
Child mortality rate female- Male difference 1988-98a WDI
% of under-fives (1985-90) suffering from underweight WDI
% of under-fives (1995-2000) suffering from underweight UNICEF/ WDI
Decade reduction in prevalence of underweight Transformed
Net Enrolment Ratio in Primary school- Total (2000/01) UNESCO
Net Enrolment Ratio in Primary school- Female (1990/91) UNESCO
Net Enrolment Ratio in Primary school- Male (1990/91) UNESCO
Female-Male Difference in NER 1990/91 UNESCO
Net Enrolment Ratio in Primary school- Total (2000/01) UNESCO
Net Enrolment Ratio in Primary school- Female (2000/01) UNESCO
Net Enrolment Ratio in Primary school- Male (2000/01) UNESCO
Gender Gap 2000/01 UNESCO
Progress in total net enrolment ratio (1990/91-2000/01 Transformed
Progress in Female net enrolment ratio (1990/91-2000/01 Transformed
Progress in reducing Female-Male difference in net Transformed
enrolment ratio (1990/91-2000/01
Macroeconomic Performance and Trends in Long-term
economic development
GNI per capita (US$) : in 2000 WDI
GDP per capita average annual growth rate (%) 1990- WDI
2000
GDP per capita average annual growth rate (%) 1960-90 WDI/transformed
Average annual Inflation Rate (%)-1990-99 WDI
Dereje Dejene Engdashet: MA Dissertation UA-IDPM. Septembre 2003 Page 101

Annex 1 continue…
Government budget allocation and priority
% of central government expenditure allocated to WDI/UNICEF
Health (1990-2000)
% of central government expenditure allocated to WDI/WNICEF
Education (1990-2000)
% of central government expenditure allocated to WDI/UNICEF
Defense (1990-2000)
Foreign Aid/ Finance and Debt service
Aid (% of GNP) Annual Average (1990-2000) WDI
Aid per capita (current US$)- Annual Average (1990- WDI
2000)
Gross private capital flows (% of GDP, PPP)- Annual WDI
Average (1990-2000)
Total debt service (% of exports of goods and services)- WDI
Annual Average (1990-2000)
Political Right and Civil liberties (Freedom Scores
And Overall Freedom Status – Freedom House)
Political rights -decade average (1-7 score) Freedom House
Civil liberties -decade average (1-7 score) Freedom House
Overall political right and civil liberties combined (1-7 Freedom House
score)
Overall Freedom Status- decade average (1-3 rate) Freedom House
Freedom Status Category (1= Free partly Free, 0 = Not Trnasformed
free)
Poverty and Income differences
% of population below $1 a day:1990-2000 WDI
Poverty gap at $1 a day (%) 1990-2000 WDI
Squared poverty gap transformed
Gini Index (different year b/n1990-99) WDI
Adult literacy
Adult literacy rate - Female: 1990 WDI
Calamities (Domestic conflict and HIV)
Average of Weighted_Conflict_Indx (1990-98) CNTS/Transformed
Prevalence of HIV (%) among Male age 15-24 (1999) WDI
Prevalence of HIV (%) among Female age 15-24 (1999) WDI
Average weighted Prevalence of HIV (%) among Female Transformed
and Male age 15-24 (1999

Annex 2. List of Countries included in the study by Region

Africa (Sub-Saharan) Latin America and Carribean CEE/CIS and Baltic
States
Angola Argentina Armenia
Benin Bolivia Azerbaijan
Botswana Brazil Georgia
Burkina Faso Chile Kazakhstan
Burundi Colombia Kyrgyzstan
Cameroon Costa Rica Tajikistan
Central African Rep. Cuba Turkey
Chad Dominican Rep. Turkmenistan
Congo Ecuador Uzbekistan
Congo, Dem. Rep. El Salvador East Asia and Pacific
Côte d’Ivoire Guatemala Cambodia
Eritrea Haiti China
Ethiopia Honduras Indonesia
Gabon Jamaica Korea, Dem. People’s Rep.
Gambia Mexico Korea, Rep. of
Ghana Nicaragua Lao PDR.
Guinea Panama Malaysia
Guinea-Bissau Paraguay Mongolia
Kenya Peru Myanmar
Lesotho Trinidad and Tobago Papua New Guinea
Liberia Uruguay Philippines
Madagascar Venezuela Thailand
Malawi Algeria Viet Nam
Mali North Africa and Middle East South Asia
Mauritania Egypt Afghanistan
Mauritius Iran Bangladesh
Mozambique Iraq Bhutan
Namibia Jordan India
Niger Lebanon Nepal
Nigeria Libya Pakistan
Rwanda Morocco Sri Lanka
Senegal Oman
Sierra Leone Saudi Arabia
Somalia Syria
South Africa Tunisia
Sudan Yemen
Tanzania
Togo
Uganda
Zambia
Zimbabwe

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University of Antwerp

Institute of Development Policy and Management

The Impact of Macroeconomic Performance, Foreign Finance and

Dereje DEJENE ENGDASHET

Masters Degree in Development Evaluation and Management

Promoter: Dr. Nathalie Holvoet

Academic Year 2002 - 2003

IV. WHAT HAMPERED THE WORLD SUMMIT FOR CHILDREN? .................................................... 20

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. Sptember, 2003

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 1

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 2

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 3

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 4

(1) Reduction of 1990 under-5 child mortality rates by one third or to a

End-decade review report of the United Nations, presented by the Secretary-

Overall, although there are a number of hypothesis, suggestions, debates and in

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 6

II. Hypothesis and Methodological Approaches

2.2 Methodical approaches

2.2.1 Review of similar studies and relevant literatures

Extensive review of similar studies/journal articles and relevant literatures,

2.2.2 Data coverage and sources

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 7

decade (1990-2000), level of inflation during the decade (1990-2000) ], as

2.2.3 Data Analysis and Presentation

A series of Data Mining procedures were followed, as an analytic process, to

Stage 2. Exploratory analyses. Depending on the nature of the variables, at this

2.2.4 Data limitation

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 9

III. The Status of Children in Global Context

3.1 Children in global demographic context

The share of children in Developing Countries is considerably higher than that of

When we dissect the data further by regions, we can observe considerable

Fig.-2 Relative population (percent) of children of different age category in

Although there is considerable variation between regions of the Developing

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 11

situation and status of children in developing countries in details in terms of

3.2 Child mortality in developing countries during the decade

Under-five mortality in developing countries declined from 103 per 1,000LB in

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 12

Out of 62 countries, for which data on female-male child mortality difference is

Ironically U5CMR has increased in 13 developing countries. The list of developing

Despite overall inadequate achievement of the envisaged goal, more than 40

3.3 Child nutrition status in developing countries during the decade:

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 13

The prevalence of under-five malnutrition4 in developing countries as a whole

Fig.-3 Prevalence of Under 5 Child Malnutrition in Developing Regions of the World

In Africa the prevalence of malnutrition is closer to world average. However, it is

3.4 Child Education (Primary school enrolment) in developing

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 15

Fig.-4. Net Enrollment Ratio in Primary School in Different Regions of the

Source: Graph produced by Author based on UNESCO data base

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 16

Fig.-5 Variation in Net Enrollment Ratio-Primary School in Different Regions

The female-male difference in getting access to primary education

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 17

Fig.-6 Net Enrollment Ratio–Primary Education in the Year 2000/1 in

Net Enrollment Ratio-Primary Education

Source: Graph produced by the Author from UNESCO data base

Dereje Dejene Engdashet: MA Dissertation. UA-IDPM. October 2003 Page 18

Courtiers known for discriminating girls in primary education as compared to

Even in countries where quantified gaps are minimal, inequalities in educational