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The worldwide governance indicators and tautology: causally related separable concepts, indicators of a common cause, or both ?

Laura Langbein and Stephen Knack

No 4669, Policy Research Working Paper Series from The World Bank

Abstract: Aggregate indexes of the quality of governance, covering large samples of countries, are widely used in research and in aid policy. Few studies examine the validity of these indexes, however. This paper partially fills this gap by examining empirically the dimensionality of the Worldwide Governance Indicators. The six indexes purportedly measure distinct concepts of control of corruption, rule of law, government effectiveness, regulatory quality, political stability, and voice and accountability. Using standard statistical techniques for testing measurement validity, the analysis concludes that the six indexes do not discriminate usefully among different aspects of governance. Rather, each of the indexes merely reflects perceptions of the quality of governance more broadly. An implication of the findings is that the Worldwide Governance Indicator indexes are frequently misused in research and policy applications, where it is commonly assumed that the indexes provide distinct measures of different aspects of the quality of governance. A further implication is that Transparency International's even more widely-known aggregate index similarly reflects perceptions not only of corruption, as intended, but of the quality of governance more broadly.

Keywords: Governance Indicators; National Governance; Public Sector Corruption&Anticorruption Measures; Statistical&Mathematical Sciences; Information Security&Privacy (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dev
Date: 2008-07-01
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