The impact of government revenue on the achievement of the Sustainable Development Goals and the amplification potential of good governance

The United Nations General Assembly established the Sustainable
Development Goals in 2015 to achieve an equitable and sustainable future for
all by 2030. This study aims to model the relationship between government
revenue per capita, quality of governance and the targets of several of these
goals, including the coverage of the critical determinants of health; water,
sanitation, healthcare, and education. We used government revenue because
the policies and practices of international and multinational organisations –
including corporations and banks – are more likely to influence revenue rather
than government spending in countries in which they are engaged. Also,
government revenue reflects a government’s ability to spend across all sectors
rather than just health or education. An unbalanced non-linear panel data
model was employed, and annual data on 217 countries over the period 1960–
2000 was used. The coverage of the Sustainable Development Goal variables
was expressed as percentages and measures of the quality of governance included
in the model. A linear relationship between revenue and the determinants of
health would not be appropriate; therefore, we employ a logistic function. A
standard panel logistic function would impose the same shape “S” curve on
all countries, which is inappropriate. Therefore, we augment the parameters
of the logistic function with measures of the quality of governance in each
country, which allows each country to have a different “S” shape as the quality
of its governance varies. Our study found that increased government revenue is
associated with increased progress towards the Sustainable Development Goals.
An improvement in the quality of governance could amplify this effect. This
modelling and its accompanying visualisations can predict the potential of an
increase in government revenue in an individual country regarding progress
towards the Sustainable Development Goals.