Why has under-5 mortality decreased at such different rates in different countries?

• We model 5q0 decline with cross-country heterogeneity in technical progress. • Estimated income elasticity of 5q0 is reduced from around −0.35 to around −0.12. • We estimate a high impact of technical progress of around 80% of recent 5q0 decline. • Geographical context and health systems have strong effects. • Female education is more important in open than closed economies. Controlling for socioeconomic and geographic factors, under-5 mortality (5q0) in developing countries has been declining at about 2.7% per year, a high rate of ‘technical progress’. This paper adduces theoretical and empirical reasons for rejecting the usual specification of homogeneous technical progress across countries and uses a panel of 95 developing countries for the period 1970–2000 to explore the consequences of heterogeneity. Allowing country-specific rates of technical progress sharply reduces the estimated income elasticity of 5q0 and points to country variation in technical progress as the principal source of the (large) cross-country variation in 5q0 decline. Education levels and physician coverage also contribute and are less affected than income of allowing country variation in technical progress. The paper concludes by decomposing 1970–2000 5q0 decline into its different sources for each country.