The World Bank recently released its annual World Governance Indicators (WGI) report. The WGI is one of the most widely utilized and analyzed indicators. For those who don’t follow indicators in all their stultifying minutiae, the key element of the WGI is that it is an aggregate indicator. This means that rather than attempting to measure governance directly, it draws on the ever-growing army of indicators, including those produced here at Freedom House, and combines them in order to detail the gains and losses made in governance across the world. Utilizing a definition of governance as “the traditions and institutions by which authority in a country is exercised,” the report offers measurements of six different aspects of governance: Voice and Accountability (VA), Political Stability and Absence of Violence (PV), Government Effectiveness (GE), Regulatory Quality (RQ), Rule of Law (RL), and Control of Corruption (CC).
The body of econometric based-literature that has grown out of the decade-long WGI project confirms the importance of good governance. Indeed, research has shown that improving governance by one standard deviation can have major effects upon quality of life in a given country: in the long run incomes rise by a factor of three and infant mortality rates drop to a third or their previous levels with this level of governance progress.
This year’s report brings with it mixed news regarding the level of governance in developing countries, including those included in Countries at the Crossroads. While the quality of governance on a global scale has advanced little, in every region some nations have shown improvement. Over the last five years some of the Crossroads countries have made particularly noteworthy progress in specific aspects of governance. For example, Ukraine has shown significant improvements in Voice and Accountability, while both Georgia and Tanzania have made great strides forward in Control of Corruption. However, countries such as Eritrea and Zimbabwe have slid backwards from the ideals of good governance.
The WGI report also specifies which countries have seen what is considered to be a significant change in at least one of the 6 areas of governance over the last ten years. Fortunately, more Crossroads nations have witnessed more positive than negative change: 16 experienced positive change in at least one category, while 14 at least one negative change. Unfortunately, of the significant changes that Crossroads’ nations experienced, more of them were negative than were positive by a count of 28-23. This reflects the fact that while nations such as Peru and Indonesia saw positive Voice and Accountability changes, four nations, Bolivia, Eritrea, Venezuela and Zimbabwe, saw negative changes in three or more areas of governance. Interestingly, only two countries, Nigeria and Ethiopia, experienced the combination of improvement in one category and decline in another. Thus, it appears that among Crossroads nations while there are many countries making incremental steps towards progress in some areas, those that are experiencing hardships are seeing decline ripple across multiple areas of governance.
In an article in the Financial Times summarizing the report, lead author Danny Kaufmann notes that it is misleading to discuss the results in terms of regions. He suggests that it is more precise to talk about change within specific countries. This is an important point as far as attempting to ensure that indicator data is used within reasonable limits. Nonetheless, there are indeed qualitative governance issues that are common in certain regions: crime and justice issues in Latin America, patronage politics in Southeast Asia, and government accountability shortcomings in the Middle East are just a few of the more obvious one that come to mind. For donor decisions, it is surely critical that individual country data be the primary focal point. But it is certainly useful to understand regional commonalities when thinking broadly about governance issues. Perhaps someone should devise a new indicator for this very purpose…
