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Defining and selecting indicators

Toward more operationally relevant indicators of governance

New governance indicators needed to foster public sector reforms

Authors:
Publisher: World Bank, 2000

Full text of document

First generation indicators of the quality of governance, such as those provided by the International Country Risk Guide and Transparency International are of little value in guiding specific public sector reforms. This paper therefore, emphasises need for second generation indicators to help determine which institutions are associated with which dimensions of public sector performance.

The paper says that second generation governance indicators should move in two directions. They should:

  • be more specific in measuring performance; and
  • pay more attention to measuring government processes and institutional arrangements—not just performance
More disaggregated measures of corruption and other dimensions of performance are needed to facilitate meaningful empirical tests of the effects of various government processes and institutions. Measures of those processes and institutions are essential for testing assumptions on the efficacy of certain public sector reforms in improving performance.

The paper notes that there has been some progress on collecting more specific performance indicators, and list out some of the examples.These efforts are expected to greatly enrich the information base on governance and public institutions. Many of these data sets will allow for more micro level (such as agency or firm) analyses of links between governance and economic performance, complementing well-known cross-country evidence on these links.