Throwing aid at HIV

Some colleagues at APSA shared a new paper by Nunnenkamp and Öhler investigating the effect of official development assistance (ODA) on HIV-related health outcomes in developing countries. The authors write:

Optimally, ODA would help prevent new HIV infections as well as provide better care for the infected. Our results indicate that ODA-financed prevention has been insufficient to reduce the number of new HIV infections. By contrast, we find evidence of significant treatment effects on AIDS-related deaths for the major bilateral source of ODA, the United States.

However, the treatment effect proved to be insignificant when multilateral organizations represented the major source of ODA. In particular, our findings are in sharp conflict with claims of the most important organization in this field—the Global Fund to Fight AIDS, Tuberculosis, and Malaria—that its performance-based support has saved almost five million lives by the end of 2009.

It seems HIV/AIDS related foreign aid is coming under increasing scrutiny these days, at least by academics. Like Bendavid and Bhattacharya (2009), Nunnenkamp and Öhler find U.S.-funded PEPFAR associated with reduced deaths due to HIV/AIDS, but not reduced prevalence of HIV. The inability of billions of dollars to reduce new infections is troubling indeed.

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