Effective Foreign Aid: Evidence from Gavi’s Vaccine Program

Abstract

Gavi, the Vaccine Alliance has provided over US$16 billion in funding for vaccination expansion in low-income countries since its founding in 1999. We exploit differential timing in Gavi support across countries and vaccines to estimate the effects of this large-scale public health initiative. We find that Gavi’s support for a vaccine increased coverage rates by 2 – 5 percentage points across all vaccines, on average, and by 10 – 20 percentage points for newer vaccines. We also find that Gavi’s support for a vaccine reduced child mortality from related causes by 0.5 – 2 children per 1,000 live births. We estimate these improvements saved between 821,000 and 3.3 million lives at a cost ranging from US$4,265 to US$17,059 per life saved. Given the relatively low cost of Gavi’s programs, we argue that Gavi represents a particularly effective form of foreign aid. As Gavi’s programs are tightly linked to desirable development outcomes and can be rigorously evaluated, our results provide support for the broader notion that careful structuring of foreign aid programs can be substantially beneficial for low-income countries.

Keywords: Foreign Aid; Health, Development; Vaccination

JEL Classification: F35, I15, O1