Childhood health and the changing distribution of foreign aid: Evidence from Nigeria’s transition to lower-middle-income status

With sustained economic growth in many parts of the developing world, an increasing number of countries are transitioning away from the most subsidized development finance as they exceed income and other qualification requirements. Cross-country evidence suggests that Development Assistance Committee (DAC) donors view the crossing over of the World Bank’s International Development Association (IDA) eligibility threshold to signal that a country needs less aid, with subsequent reductions in both IDA and other donors’ concessional funding. Within the health sector, it is particularly important to understand the implications of these status changes for children under five years of age since improving early childhood health is critical to fostering health and social and economic development. Therefore, we examine the implications of the IDA transition by measuring the extent t which World Bank commitments—including both IDA and IBRD—are directed to infant and child health needs in Nigeria. Ordinary Least Squares (OLS) models were used in a difference-indifferences (DID) strategy to compare World Bank IBRD/IDA lending before and after the crossover to regions with varying initial levels of under-five and infant need.