International Benchmark 01: World Governance Indicators

There are a number of international benchmarks that shows the quality of key indicators of governance, social and economic progress of Singapore. This marks the first of a series of articles in which I shall write about these international benchmarks.

World Governance Indicators

World Governance Indicators (WGI) reports aggregate and individual governance indicators for 213 economies over the period 1996-2009. The research defines governance as “the traditions and institutions by which authority in a country is exercised. This includes (a) the process by which governments are selected, monitored and replaced; (b) the capacity of the government to effectively formulate and implement sound policies; and (c) the respect of citizens and the state for the institutions that govern economic and social interactions among them. Two measures of governance corresponding to each of these three areas were constructed, resulting in a total of six dimensions of governance:

(a) The process by which governments are selected, monitored, and replaced:

1. Voice and Accountability (VA) – capturing 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 (PV) – capturing perceptions of the likelihood that the government will be destabilized or overthrown by unconstitutional or violent means, including politically‐motivated violence and terrorism.

(b) The capacity of the government to effectively formulate and implement sound policies:

3. Government Effectiveness (GE) – capturing 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 (RQ) – capturing perceptions of the ability of the government to formulate and implement sound policies and regulations that permit and promote private sector development.

(c) The respect of citizens and the state for the institutions that govern economic and social interactions among them:

5. Rule of Law (RL) – capturing 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 (CC) – capturing 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.

The research team noted that these six dimensions of governance should not be thought of as being somehow independent of one another. One might reasonably think for example that better accountability mechanisms lead to less corruption, or that a more effective government can provide a better regulatory environment, or that respect for the rule of law leads to fairer processes for selecting and replacing governments and less abuse of public office for private gain. In light of such inter‐relationships, it is not very surprising that the six composite measures of governance are strongly positively correlated across countries. These inter‐relationships also mean that the task of assigning individual variables measuring various aspects of governance to the six broad categories is not clear‐cut.

For more information on the methodology, refer to Kaufmann, Daniel.; Kraay, Aart.; Mastruzzi, Massino. (2010) The Worldwide Governance Indicators: Methodology and Analytical Issues. The World Bank Policy Research Working Paper 5430.

How does Singapore fare in WGI? I took the numbers from the dataset, which is available online, and compared our scores with 14 other economies. The selection includes East Asian economies which we are often grouped together with, South-east Asian economies of which we are a part of, key European economies and the United States.

1. Voice and Accountability (VA): Our scores for this dimension were average but it took a dip from 2006 onwards. Singapore has often been perceived as a country that does not fully support a freedom of expression. It is thus unsurprisingly that our scores, compared to the western countries and Japan, are considerably lower.

2. Political Stability and Absence of Violence/Terrorism (PV): This is a dimension where our scores have improved steadily since 1996, and the scores are all over 88 from 2006 onwards. With the exception of Switzerland, we have performed better int this aspect than the other 13 economies.

3. Government Effectiveness (GE): This is a dimension in which Singapore has performed consistently well, scoring at least 93 since 1996.

4. Regulatory Quality (RQ): Together with Hong Kong, we have full scores in this dimension for almost every year since 1996, beating all other economies on the chart.

5. Rule of Law (RL): We performed consistently well in this dimension, scoring above 90 except in 2000.

6. Control of Corruption (CC): We out-performed most other economies in this dimension, scoring at least 96 since 1996.

In summary, Singapore has done exceedingly well in all dimensions of governance except for “Voice and Accountability”. Singapore needs to be perceived as not exercising self-censorship, and its political leaders must be seen as being fully accountable to its electorate. With 82 out of 87 seats contested in this election, and the widespread use of social media as an alternative voice to the mainstream media, we can be hopeful that we will do better in this dimension in the near future.

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