World Governance Survey: a new approach to assessing governance
By J. Court and G. Hyden - 2005
UN Secretary-General Kofi Annan has stated that ‘good governance is perhaps the single most important factor in eradicating
poverty and promoting development’. If governance matters, so does the need for more reliable and valid data on key governance processes.
The United Nations University (UNU) has begun to address this need with a World Governance Survey (WGS).
A pilot phase was carried out in early 2001 and a larger round of country assessments is planned for 2003.
In the pilot phase, governance assessments were undertaken in 16 developing and transitional societies,
representing 51 per cent of the world’s population (see table). In each country, a national coordinator selected
a panel of experts to complete the assessment. The panel comprised persons with extensive experience of the governance realm,
including parliamentarians, researchers, lawyers and civil servants; around 35 people were interviewed per country.
The project identified 30 indicators based on widely held ‘principles’ of good governance: participation, fairness,
decency, accountability, transparency and efficiency. Respondents were asked to rank each answer on a scale from 1 to 5;
the higher the score, the better. In addition, respondents were invited to provide qualitative comments.
The table shows the median indicator rating for each country for the 10 indicators that relate particularly
to accountability and transparency. It also shows the total governance score for each country.
The total governance scores have a very robust correlation (0.77) with the country scores in Kaufmann et al.’s
aggregate governance indicators, indicating the validity of the results.3
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The judiciary and governance in 16 developing countries
By J. Court, G. Hyden and K. Mease - 2005
Individuals and groups inevitably at times get into conflict and societies require institutions that can resolve disputes.
As part of a project to undertake comprehensive governance assessments, we focus here on the nature of
the rules (formal and informal) that affect the judicial arena. The legal culture of a society is
important for how people perceive not only the judiciary but also the political system at large.
The way judicial institutions operate also has an impact on a country’s economic and development performance.
This paper presents the findings for the judiciary arena in 16 developing countries.
We find that the judicial arena is problematic in virtually all countries included in our survey.
Access to justice remains low. Administration of justice is not only slow, but there is often widespread
corruption and a lack of accountability. People lack trust in the court system.
The problems are particularly pronounced in former communist countries, including China, because of both
the pace and extent of economic and political reform. Laws are often outdated and create problems
for the transformation of these regimes.
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Asymmetric Globalization: global markets require good global politics
By N. Birdsall - 2002
The paper sets out two views of the facts about the effects of globalization on world poverty and inequality.
The bottom line: globalization is not the cause, but neither is it the solution to world poverty and inequality.
The paper then explores why and how the global economy is stacked against the poor, making globalization asymmetric,
at least up to now. It concludes with some ideas about a new agenda of good global politics, an agenda to shape
a future global economy and society that is less poor and less unequal -- not only because it is more global
and competitive, but also because it is more fair and more politically representative.
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Understanding the relationship between institutions and economic development - some theoretical issues
By Ha-Joon Chang - 2005
The issue of institutional development, or “governance reform”, has come to
prominence during the last several years. During this period, the academic literature on
institutions and development has exploded. And today even the World Bank and the IMF,
which used to dismiss institutions as mere “details” that do not affect the wisdom of the
orthodox economic theory, have come around to emphasising the role of institutions in
economic development. For example, the International Monetary Fund (IMF) put great
emphasis on reforming corporate governance institutions and bankruptcy laws during the
1997 Asian crisis, while the World Bank’s recent annual report (Building Institutions for
Markets, 2002) focuses on institutional development, although from a rather narrow point of
view, as indicated by its title.
Of course, the new attention paid to institutions in the orthodox literature should not
be seen as the result of an innocent scholastic awakening. Rather, it is better seen as an
attempt to cope with the continued failures of orthodox policies in the real world.
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Institutions, policies and economic development
By G. W. Kolodko - 2005
Institutions are not only created and built, but also – and especially – need to be learnt.
It is a process which takes place in all economies, but acquires a special importance in less
advanced countries. Not only theoretical arguments, but also the practical experience over the
past 15 years demonstrate that faster economic growth – and hence also, more broadly, socioeconomic
development – is attained by those countries which take greater care to foster the
institutional reinforcement of market economy. However, progress in market-economy
institution building is not in itself sufficient to ensure sustained growth. Another
indispensable component is an appropriately designed and implemented economic policy
which must not confuse the means with the aims.
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Governance in decentralized development aid programs
By J. P. Platteau and F. Gaspart - 2004
Of late, there has been growing concern about weak aid effectiveness and low
absorption capacity of poor countries (Boone, 1996; Alesina and Dollar, 2000; Burnside and
Dollar, 2000; Isham and Kaufmann, 2000; Easterly et al., 2003; Collier and Dollar, 2004).
This results both in low rates of aid disbursement, and in low effectiveness of aid actually
disbursed. Regarding the latter consequence, Svensson (2000, 2003) and Kanbur
(forthcoming) have argued that, when conditions are attached to an aid program (such as the
requirement of reform efforts in structural adjustment programs), money tends to be disbursed
irrespective of whether these conditions have been fulfilled or not. According to Svensson
(2003), the bias towards disbursing committed funds to the ex ante designated recipient
irrespective of its performance, is caused by a ‘budget-pressure problem’ arising from the
high cost of not disbursing the money allocated. To some extent at least, such kind of
problems, it may be pointed out, prevent low aid effectiveness from inducing still lower rates
of aid disbursement.
The main contention of this paper is that the problem of weak aid effectiveness due to
lax implementation of conditionality may also undermine programs of participatory or
decentralized development. In particular, problems of corruption and opportunistic behavior
do not disappear because aid is channelled through local levels. There is no reason to think
that patronage is less present at those levels than at the top of the government’s hierarchy.
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Corruptibility, transparency, and bureaucratic
institutional structure
John Bennett & Saul Estrin 2005
We analyze the role of bureaucratic corruption in the context of infrastructure
investment and public service provision by a foreign firm in a developing economy.
This type of investment involves a relatively large sunk element, and so the investor
may offer a bribe to avoid expropriation, as well as to obtain more favourable terms in
the initial contract. We examine these issues for both a centralized and a decentralized
bureaucracy, and we consider the role of transparency in each case. Among our results
is that, provided there is transparency, domestic welfare and social efficiency may be
enhanced by decentralization. The key factor underlying this result is that one
bureaucrat in effect may collude with the investor to reduce the payoff of another
bureaucrat.
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