New Zealand rates well in latest Worldwide Governance Indicators

15 September 2012

The 2011 Worldwide Governance indicators prepared jointly by the Brookings Institute and the World Bank were published ( belatedly ) on Friday – which was International Democracy Day.

The latest report covers 215 countries including new states like South Sudan and countries with small populations and a dearth of data, like Greenland and Tuvalu. The indicator scores are derived from more than 30 sources by collating data from hundreds of disaggregated questions.

The indicators evaluate six elements –

1. Voice and Accountability: captures 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 a free media.

2. Political Stability and Absence of Violence/Terrorism: captures perceptions of the likelihood that the government will be destabilized or overthrown by unconstitutional or violent means, including politically-motivated violence and terrorism.

3. Government Effectiveness: captures perceptions of 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: captures 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: captures perceptions of the extent to which agents have confidence in and abide by the rules of society, and in particular the quality of contract enforcement, property rights, the police and the courts, as well as the likelihood of crime and violence.

6. Control of Corruption: captures perceptions of the extent to which public power is exercised for private gain, including both petty and grand forms of corruption, as well as “capture” of the state by elites and private interests.

New Zealand has improved its rating and placement since 2010, recovering the ground it lost that year. Ironically the only indicator score which was lower than in 2010 was for controlling corruption – on which in all previous years it had been the most highly rated. Denmark has moved ahead of New Zealand. ( This appears to be a consequence of Transparency International data reflected in the 2010 global corruption barometer – where in what seems an incredible claim, almost one in four surveyed New Zealanders said that they, or a family member had paid a bribe in the preceding 12 months.)

The improvement in the other five of the six indicators restores New Zealand’s position as one of the top ten countries on all six indicators. Not surprisingly Finland and Denmark are consistently the highest scoring countries.

The evaluation means that measures specified in the New Zealand Auditor General’s Statement of Intent for evaluating “trust in Government”are met – this required that New Zealand was ranked in the 90th percentile for each of the six Worldwide Governance Indicators ( not a challenging requirement having regard to the New Zealand ratings since the WGI began in 1996. )

The World Bank website with the results has an interactive tool which enables a comparison of ratings by year or years for a country or by a particular indicator. It is not helpful in identifying the countries with the top rating for each indicator.

More generally the results show that governance has not improved in extractive-rich countries, where corruption is often worsening. “…And we know that governance matters. Past research has pointed to a very high payoff for governance reforms, which we have characterized as the ‘300 percent development dividend of good governance’. Improvements in governance (by one standard deviation) have been causally associated with about a three-fold increase in a country’s income per capita on average….”

However from a New Zealand perspective, a heartening result in what is the most comprehensive dataset from which good government comparisons can be made – and presumably released on International Democracy Day because of that connection.

The chart is my extract from the dataset, showing the top ten countries in the six indicators.

Voice and Accountability	Political Stability	Government Effectiveness	Regulatory Quality	Rule of Law	Controlling Corruption
Switzerland	Liechtenstein	Finland	Denmark	Finland	Denmark
Norway	Finland	Denmark	New Zealand	Sweden	New Zealand
Denmark	New Zealand	Sweden	Luxembourg	Denmark	Sweden
Sweden	Luxembourg	New Zealand	Netherlands	New Zealand	Finland
Luxembourg	Switzerland	Switzerland	Sweden	Norway	Luxembourg
Liechtenstein	Sweden	Netherlands	Singapore	Netherlands	Netherlands
Finland	Iceland	Norway	Australia	Luxembourg	Norway
New Zealand	Singapore	Liechtenstein	Finland	Australia	Australia
Netherlands	Netherlands	Australia	Ireland	Ireland	Singapore
Iceland	Denmark	Luxembourg	Switzerland	Switzerland	Switzerland