One Market, One Number? A Composite Indicator Assessment of EU Internal Market Dynamics
AbstractWe consider the lack of consensus about an appropriate theoretical framework linking sub-indicators as a defining characteristic of composite indicators. This intrinsic feature implies uncertainties about the appropriate normalisation and aggregation of the raw data. The two are related: index theory offers some valuable guidelines about their connection. Yet these do not fully solve the basic problem of expert disagreement. We embed such (residual) disagreement in the aggregation method itself. Specifically, we apply an impartial benefit-of-the-doubt weighting procedure, where weight restrictions incorporate the available information on experts’ opinions. We apply this procedure to the dynamic performance assessment of EU Internal Market effects, thereby highlighting its capacity to disaggregate member states’ observed performance shifts into changes relative to benchmarks and performance changes of the benchmarks (i.e. catching up versus genuine progress). Our results indicate that the latter factor is more important in explaining the observed progress.
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Bibliographic InfoPaper provided by Katholieke Universiteit Leuven, Centrum voor Economische Studiën, Working Group Public Economics in its series Public Economics Working Paper Series with number ces0513.
Length: 37 pp.
Date of creation: 2005
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Other versions of this item:
- Cherchye, Laurens & Knox Lovell, C.A. & Moesen, Wim & Van Puyenbroeck, Tom, 2007. "One market, one number? A composite indicator assessment of EU internal market dynamics," European Economic Review, Elsevier, vol. 51(3), pages 749-779, April.
- E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical
- E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
- F02 - International Economics - - General - - - International Economic Order; Noneconomic International Organizations;; Economic Integration and Globalization: General
- O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
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