This chapter explores the question of whether international aid can improve global health. Many current health indicators suggest that millions of the poor suffer from a lack of basic healthcare. International aid to the health sector has increased fourfold over the last 40 years. Macrolevel cross-country studies argue that health aid is ineffective at improving mortality rates, life expectancy, and a number of other health indicators. Recent micro-level studies have found some evidence of successful health aid interventions. The chapter presents an overview of the current state of health in poor countries. It summarizes the findings and conclusions from pre-existing work on health aid. The chapter explains, using the economic way of thinking, why health aid has not achieved results on a large scale. This relies on analyzing the role of information and incentives in both the donor and recipient countries.
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