Introduction • 3 between these two approaches – the political economy of governance and technocratic institutional engineering – makes easy resolution improbable.
Governance and growth: Conceptual, methodological and measurement issues Effective government or good governance matters, but it is not obvious or clear what that means. The World Bank’s Worldwide Governance Indicators (WGIs) project has attempted to define the indicators as corresponding to what the authors consider to be ‘fundamental governance concepts’ (Kaufmann, Kraay and Zoido-Lobato 1999b: 1). Kaufmann et al. have published eight papers (Kaufmann, Kraay and Zoido-Lobato 1999a, 1999b, 2002; Kaufmann, Kraay and Mastruzzi 2004, 2005, 2006a, 2007, 2008); however, the definitions of the indicators have changed over time since the indicators were first introduced. For example, in 2006, the definition of the ‘political stability and absence of violence’ indicator was redefined to measure ‘perceptions of the likelihood that the government will be destabilized’, rather than the likelihood itself (Kaufmann et al. 2007), and in 2008, the remaining indicators were redefined as measures of perceptions, instead of measures of the phenomena themselves (Kaufmann et al. 2008). The most recent definitions of indicators are as follows (Kaufmann et al. 2008): 1 Voice and accountability (VA) – measuring perceptions of the extent to which a country’s citizens are able to participate in selecting their government, as well as freedom of expression, freedom of association and media freedom. 2 Political stability and absence of violence (PS) – measuring perceptions of the likelihood that the government will be destabilized or overthrown by unconstitutional or violent means, including political violence and terrorism. 3 Government effectiveness (GE) – measuring the quality of public services, the quality of the civil service and the degree of its independence from political pressures, the quality of policy formulation and implementation, and the credibility of the government’s commitment to such policies. 4 Regulatory quality (RQ) – measuring perceptions of the ability of the government to formulate and implement sound policies and regulations that permit and promote private sector development. 5 Rule of law (RL) – measuring perceptions of the extent to which agents have confidence in and abide by the rules of society, and in particular, the
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