Globalization and health equity: The impact of structural adjustment programs on developing countries.

Among the many drivers of health inequities, this article focuses on important, yet insufficiently understood, international-level determinants: economic globalization and the organizations that spread market-oriented policies to the developing world. One such organization is the International Monetary Fund (IMF), which provides financial assistance to countries in economic trouble in exchange for policy reforms. Through its 'structural adjustment programs,' countries around the world have liberalized and deregulated their economies. We examine how policy reforms prescribed in structural adjustment programs explain variation in health equity between nations-approximated by health system access and neonatal mortality. Our empirical analysis uses an original dataset of IMF-mandated policy reforms for a panel of up to 137 developing countries between 1980 and 2014. We employ regression analysis to evaluate the relationship between these reforms and health equity, taking into account the non-random selection and design of IMF programs. We find that structural adjustment reforms lower health system access and increase neonatal mortality. Additional analyses show that labor market reforms drive these deleterious effects. Overall, our evidence suggests that structural adjustment programs endanger the attainment of Sustainable Development Goals in developing countries.

How structural adjustment programs affect inequality: A disaggregated analysis of IMF conditionality, 1980-2014.

This article highlights an important yet insufficiently understood international-level determinant of inequality in the developing world: structural adjustment programs by the International Monetary Fund (IMF). Studying a panel of 135 countries for the period 1980 to 2014, we examine income inequality using multivariate regression analysis corrected for non-random selection into both IMF programs and associated policy reforms (known as 'conditionality'). We find that, overall, policy reforms mandated by the IMF increase income inequality in borrowing countries. We also test specific pathways linking IMF programs to inequality by disaggregating conditionality by issue area. Our analyses indicate adverse distributional consequences for four policy areas: fiscal policy reforms that restrain government expenditure, external sector reforms stipulating trade and capital account liberalization, financial sector reforms entailing inflation-control measures, and reforms that restrict external debt. These effects occur one year after the incidence of an IMF program, and persist in the medium term. Taken together, our findings suggest that the IMF's recent attention to inequality neglects the multiple ways through which the organization's own policy advice has contributed to inequality in the developing world.

Impact of International Monetary Fund programs on child health.

Parental education is located at the center of global efforts to improve child health. In a developing-country context, the International Monetary Fund (IMF) plays a crucial role in determining how governments allocate scarce resources to education and public health interventions. Under reforms mandated by IMF structural adjustment programs, it may become harder for parents to reap the benefits of their education due to wage contraction, welfare retrenchment, and generalized social insecurity. This study assesses how the protective effect of education changes under IMF programs, and thus how parents' ability to guard their children's health is affected by structural adjustment. We combine cross-sectional stratified data (countries, 67; children, 1,941,734) from the Demographic and Health Surveys and the Multiple Indicator Cluster Surveys. The sample represents ∼2.8 billion (about 50%) of the world's population in year 2000. Based on multilevel models, our findings reveal that programs reduce the protective effect of parental education on child health, especially in rural areas. For instance, in the absence of IMF programs, living in an household with educated parents reduces the odds of child malnourishment by 38% [odds ratio (OR), 0.62; 95% CI, 0.66-0.58]; in the presence of programs, this drops to 21% (OR, 0.79; 95% CI, 0.86-0.74). In other words, the presence of IMF conditionality decreases the protective effect of parents' education on child malnourishment by no less than 17%. We observe similar adverse effects in sanitation, shelter, and health care access (including immunization), but a beneficial effect in countering water deprivation.

Structural adjustment and public spending on health: evidence from IMF programs in low-income countries.

The relationship between health policy in low-income countries (LICs) and structural adjustment programs devised by the International Monetary Fund (IMF) has been the subject of intense controversy over past decades. While the influence of the IMF on health policy can operate through various pathways, one main link is via public spending on health. The IMF has claimed that its programs enhance government spending for health, and that a number of innovations have been introduced to enable borrowing countries to protect health spending from broader austerity measures. Critics have pointed to adverse effects of Fund programs on health spending or to systematic underfunding that does not allow LICs to address health needs. We examine the effects of Fund programs on government expenditures on health in low-income countries using data for the period 1985-2009. We find that Fund programs are associated with higher health expenditures only in Sub-Saharan African LICs, which historically spent less than any other region. This relationship turns negative in LICs in other regions. We outline the implications of these findings for health policy in a development context.