RFE/RL: Your study ranks governance according to six criteria usually associated with open societies. They range from political stability to government effectiveness to rule of law, just to mention three. And your report includes a world map where good governance is shown by a lighter color and poor governance by a darker one. How does the map look for countries in the former Soviet sphere?
Aart Kraay: Looking at the map, certainly the Central Asia area, narrowly construed -- there's not a lot of [the] light colors that we like to see. Where you start to get an interesting story is when you look at changes over time. On the Eastern Europe end of things, there are countries that are really showing progress. Countries like Ukraine and Serbia are countries that are showing sharp improvements on our indicators of especially things like democratic accountability. And so when you think about the history of changes in former Yugoslavia -- particularly between the mid-1990s and the mid-2000s, where we are now -- it's not surprising that you see big improvements.
Often new governments that are very energetic [and] they're able to make progress in different areas. And then you start to see these sort of nitty-gritty changes in how governments do business that make regulations less onerous, that make government better at delivering services, that reduce the opportunities for corruption.
RFE/RL: Does this mean that you're optimistic about the countries of the former Yugoslavia, particularly Serbia?
Kraay: Well, you always have to be cautious in interpreting trends in this data, especially because, in lots of countries, there're only small changes from year to year. But you look at a country like [the former] Serbia and Montenegro, you kind of see across-the-board improvements in voice and accountability, government effectiveness, regulatory quality, rule of law, control of corruption -- all of these things are improving.
A big part of this story is changes in democratic accountability. The voice-and-accountability measure for Serbia has increased a lot over the past eight or 10 years. On some of these other dimensions, the improvements are smaller and probably not as important as the one that you see in democratic accountability.
RFE/RL: For the countries that are showing improvement in governance, what is the single most important thing that they're doing to achieve this success?
Kraay: That's a really tough question. One of the things that often jumps out at you is that they're associated with sort of major political transitions. So you think about the transition around the Orange Revolution in Ukraine or, for that matte,r the transition from [former Yugoslav President Slobodan] Milosevic to his successors in Serbia. These sorts of big transitions in politics tend to get picked up a lot just in the direct measures of democratic accountability. And they often are associated with improvements in other areas, because there's a whole, huge wealth of experience on what drives reforms.
According to the World Bank, Ukraine has made considerable progress since the 2004 Orange Revolution (epa file photo)
Often new governments that are very energetic, very motivated -- they have, for a while at least, a lot of confidence from the people -- they're able to make progress in different areas. And then you start to see these sort of nitty-gritty changes in how governments do business that make regulations less onerous, that make government better at delivering services, that reduce the opportunities for corruption.
RFE/RL: What's the most important lesson we can learn from this report?
Kraay: One thing I should take the opportunity to point out is that, while it's true on average that rich countries are ones with good governance, there are also some quite poor countries that do better than you'd think. And it's encouraging because it shows that even poor countries are able to develop good institutions. It's not that good governance is a luxury that countries have to wait for once they're rich. There are a number of countries in Africa that find themselves in the 50th to 75th percentile of the rule of law. So there are poorer countries that are doing quite respectably, and this, I think, is a hopeful message.
RFE/RL: Finally, could you tell us a little about how you gather the data for your report?
Kraay: We have gathered a very large number of individual data sources that give us information about these different dimensions of governance. For example, firms in a large number of countries are asked about their interactions with governments, their interactions with the bureaucracies, their views on how common corruption is in firms like themselves.
We have surveys of individuals in many different countries that also ask similar questions: what are people's perception of the security of their property, how they view the threat of crime, how likely they think corruption is. And we also have a large amount of data that comes from so-called expert assessments, if you like. These are data sources that are put together by organizations as diverse as the World Bank and other multilateral organizations, nongovernmental organizations, commercial risk-rating agencies, and they also provide ratings of countries in various dimensions.
Then we combine all of this information and sort it out into categories corresponding to the six measures of governance that we're looking at [the report’s six criteria are: voice and accountability, political stability and absence of violence, government effectiveness, regulatory quality, the rule of law, and control of corruption], and we come up with a summary indicator that tells us where countries stand on these different dimensions of governance.