Governance indicators : where are we, where should we be going ?

With the concept of good governance gaining prominence in development literature, there has been an intense interest in more refined, nuanced and policy-relevant indicators of governance. This paper reviews the progress to date in the area of measuring governance. It concludes that while there has been considerable progress in the area of measuring governance over the past decade, the indicators that exist, and the ones that are likely to emerge in the near future will remain imperfect. The authors use a simple framework of analysis focusing on two key questions:

• what is being measured?
• whose views are being relied on?

For the first question, the authors distinguish between indicators measuring formal laws or rules, and indicators that measure the practical applications or outcomes of these rules. For the second question, they distinguish between experts and survey respondents on whose views governance assessments are based. With a view to guiding the refinement of existing governance indicators and the development of future indicators, the authors emphasise the need to:

• transparently disclose and account for the margins of error in all indicators
• draw from a diversity of indicators and exploit complementarities among them
• to move away from false dichotomies such as ‘subjective’ vs ‘objective’ indicators, or ‘aggregate’ or ‘disaggregated ones’
• submit all indicators to rigorous public and academic scrutiny
• to be realistic in the expectations of future indicators