THE EFFECTIVENESS OF FOREIGN AID ON DECREASING INFANT MORTALITY IN INDONESIA

There has been long debate about the effectiveness of foreign aid both on economic growth and human development. To achieve the targets of MDGs, aid to developing countries has been doubled in order to promote the human development. The purpose of this research was to find out the effectiveness of foreign aid specifically on health in Indonesia. Data of foreign aid on health was collected from the OECD (the Organization for Economic Co-operation and Development) from 1980 to 2011. The result of regression showed that foreign aid on health significantly affected infant mortality in Indonesia in one lagged aid. It means that Indonesia still needs aid because of insufficient budget of the government to fund health sector as mandated by the law number 36, 2009. Keywords: Infant mortality, foreign aid on health, MDG