Political governance indicators and Small States

Abstract

The objective of this dissertation is to explore whether Governance in small states differs markedly from those of larger countries. The dissertation will examine a number of international indicators of governance, including the Worldwide Governance Indicators, the Corruption Perception Index and the Legal System and Property Rights Index (one of the indices of the Economic Freedom of the World Indicators). These three indices cover a large number of countries, including many small states. The approach adopted in this dissertation is to take three well-known global indicators and test whether the governance scores are correlated with country size. Small states are divided into two groups, namely those with a population of 500,000 persons or less (labelled very small states – VSS) and those with a population of over 500,000 and up to 2 million persons (labelled as medium-small states - MSS). The remaining groups of countries are also classified in terms of their population as medium large states (MLS) with a population of between 2 and 10 million persons, large states (LS) with a population of between 10 and 50 million and very large states (VLS) with a population of over 50 million. The countries are also classified according to their GDP per capita to assess whether the governance scores are associated with the stage of development of countries. The results are presented graphically and in tabular formats. The dissertation addresses the following two research questions: 1. Is governance in small states generally better than governance in larger states? 2. Can the conclusion to research question 1 be applied to high-income as well as low-income small states? The main conclusions are that, using the three global indicators listed above, on average small states register relatively high governance scores, higher than those pertaining to larger states. However this average hides considerable divergences. In fact when disaggregated by income per capita, the small states tended to register lower governance scores as their income per capita decreased. It therefore emerges very clearly that governance is more directly related to the stage of development than to population size.