Rethinking Governance: Empirical Lessons Challenge Orthodoxy
AbstractIn this discussion draft, linking research findings with concrete operational challenges, we review key issues in worldwide governance, and present recent empirical evidence. Focusing on defining and unbundling key governance components, such as rule of law, voice and accountability, corruption control, and state capture, we then provide evidence which suggests a sobering picture: on average, there appears to be scant progress worldwide in recent times in improving rule of law and governance, in controlling corruption, and in improving institutional quality -- although there is clearly variance across countries. Further, recent empirical research points to the private sector as influencing public governance, thereby challenging traditional notions of the functioning of politicians, public policy and the public sector, and on the conventional determinants of the investment climate. We posit that the interplay between the elite’s vested interests and the political dynamics within a country, in turn affecting governance and corruption, has often been under-emphasized in program design. These argue for revisiting conventional approaches to promote institutional reform. In particular, we challenge the notion that passing laws by fiat, creating new public institutions, or embarking on anti-corruption 'campaigns', can be very effective, and question the value of traditional public sector management and conventional legal/judiciary reform approaches for many emerging economies. We argue instead that sharper focus on external accountability is required, focusing on: transparency mechanisms and empirically-based monitoring tools (including e*governance), as well as participatory 'voice' and incentive-driven approaches for prevention. These need to feature more prominently in providing checks and balances on traditional public institutions, in empowering non-traditional stakeholders, and in ameliorating state capture and mitigating the very ‘unequal influence' playing field in many countries. In turn, this necessitates probing deeper into the private-public governance nexus, which inter alia leads to focusing on concrete measures to address the challenges of political contestability, political financing reform, and transparency in parliaments, the judiciary and the executive. Recommendations on governance strategies for the next phase are suggested, including on the role of the international community.
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Bibliographic InfoPaper provided by EconWPA in its series Macroeconomics with number 0308007.
Length: 47 pages
Date of creation: 27 Aug 2003
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governance; empirical analysis; corruption; rule of law; accountability; state capture; public policy; public sector management; transparency; indicators;
Find related papers by JEL classification:
- E0 - Macroeconomics and Monetary Economics - - General
- H0 - Public Economics - - General
- H4 - Public Economics - - Publicly Provided Goods
- K0 - Law and Economics - - General
- K2 - Law and Economics - - Regulation and Business Law
- K4 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior
- L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
- L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
- L5 - Industrial Organization - - Regulation and Industrial Policy
- M2 - Business Administration and Business Economics; Marketing; Accounting - - Business Economics
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
- P0 - Economic Systems - - General
- P5 - Economic Systems - - Comparative Economic Systems
This paper has been announced in the following NEP Reports:
- NEP-ALL-2003-08-31 (All new papers)
- NEP-LAM-2003-08-31 (Central & South America)
- NEP-LAW-2003-08-31 (Law & Economics)
- NEP-MIC-2003-08-31 (Microeconomics)
- NEP-PBE-2003-08-31 (Public Economics)
- NEP-POL-2003-08-31 (Positive Political Economics)
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