Governance Indicators

Indicators and rankings are widely used by governments and organisations to assess the effectiveness, efficiency, and success of policy decisions. This book evaluates the creation of indicators, their impact on policy decisions, and the implications of their use.

This study helps users find their way through the jungle of governance indicators, and shows how they tend to be widely misused both in international comparisons and in tracking changes in individual countries.

As difficult as it might seem to define governance, it appears to be that much more difficult to measure it. Since the World Bank Institute launched the Worldwide Governance Indicators in the late 1990s, the governance indicators field has flourished and experienced significant advances in terms of methodology, data coverage and quality, and policy relevance. Other major initiatives have added to a momentum that propelled research on governance indicators seen in few other academic fields in the economic and social sciences. Given these developments and the prominence and policy relevance the field of governance indicator research has achieved, the time is ripe to take stock and ask what has been accomplished, what the shortcomings and potentials might be, and what steps present themselves as a way forward. This volume-- the fifth edition in an annual series tackling different aspects of governance around the world-- assesses what has been achieved, identifies strengths and weaknesses of current work, and points to issues that need to be tackled in order to advance the field, both in its academic importance as well as in its policy relevance. In short, the contributions to this volume explore the scope of existing governance indices and indicator frameworks, elaborate on current challenges in measuring and analysing governance, and consider how to overcome them.

Abstract: Scholars, policymakers, aid donors, and aid recipients acknowledge the importance of good governance for development. This understanding has spurred an intense interest in more refined, nuanced, and policy-relevant indicators of governance. In this paper we review progress to date in the area of measuring governance, using a simple framework of analysis focusing on two key questions: (i) what do we measure? and, (ii) whose views do we rely on? For the former question, we distinguish between indicators measuring formal laws or rules 'on the books', and indicators that measure the practical application or outcomes of these rules 'on the ground', calling attention to the strengths and weaknesses of both types of indicators as well as the complementarities between them. For the latter question, we distinguish between experts and survey respondents on whose views governance assessments are based, again highlighting their advantages, disadvantages, and complementarities. We also review the merits of aggregate as opposed to individual governance indicators. We conclude with some simple principles to guide the refinement of existing governance indicators and the development of future indicators. We emphasize the need to: transparently disclose and account for the margins of error in all indicators; draw from a diversity of indicators and exploit complementarities among them; submit all indicators to rigorous public and academic scrutiny; and, in light of the lessons of over a decade of existing indicators, to be realistic in the expectations of future indicators.

Abstract: The Worldwide Governance Indicators, reporting estimates of six dimensions of governance for over 200 countries between 1996 and 2005, have become widely used among policymakers and academics. They have also attracted some explicit written criticisms. In this short paper the authors synthesize 11 critiques offered by four recent papers. They then refute them as either conceptually incorrect or empirically unsubstantiated.

With the right method, aggregate indicators can provide useful estimates of basic governance concepts as well as measures of the imprecision of these aggregate estimates and their components.

Abstract: This paper reports on the latest update of the Worldwide Governance Indicators (WGI) research project covering 212 countries and territories and measuring six dimensions of governance between 1996 and 2006: voice and accountability, political stability and absence of violence, government effectiveness, regulatory quality, rule of law, and control of corruption. This latest set of aggregate indicators are based on hundreds of specific and disaggregated individual variables measuring various dimensions of governance taken from 33 data sources provided by 30 different organizations. The data reflect the views on governance of public sector, private sector, and nongovernmental organization experts, as well as thousands of citizen and firm survey respondents worldwide. The paper also explicitly reports the margins of error accompanying each country estimate. These reflect the inherent difficulties in measuring governance using any kind of data. It finds that even after taking margins of error into account, the WGI permit meaningful cross-country comparisons, as well as monitoring progress over time. In less than a decade, a substantial number of countries exhibit statistically significant improvements in at least one dimension of governance, while other countries exhibit deterioration in some dimensions. The decade-long aggregate indicators, together with the disaggregated individual indicators, are available in a newly-redesigned website at www.govindicators.org.

This highly accessible book investigates the rankings that increasingly influence perceptions of countries' governance and civil rights.

Using a power-knowledge framework, this volume critically investigates how major global indicators of legal governance are produced, disseminated and used, and to what effect. Original case studies include Freedom House's Freedom in the World indicator, the Global Reporting Initiative's structure for measuring and reporting on corporate social responsibility, the World Justice Project's measurement of the rule of law, the World Bank's Doing Business index, the World Bank-supported Worldwide Governance Indicators, the World Bank's Country Performance Institutional Assessment (CPIA), and the Transparency International Corruption (Perceptions) index. Also examined is the use of performance indicators by the European Union for accession countries and by the US Millennium Challenge Corporation in allocating US aid funds.

Updated governance indicators report estimates of six dimensions of governance for 175 countries in 2000-01. They can be compared with those constructed for 1997-98.