5th Black Sea Symposium
The Black Sea region as an influential crossroad
between East and West:
A path towards extroversion”
The quality of national institutional environment in NC and Black Sea
countries: Burden or opportunity for regional development and
innovation?
Nikolaos Hlepas, Assoc. Professor, Dept. of Political Science & Public Administration,
National and Kapodistrian University of Athens
nhlepas@gmail.com
Athens, 2 July 2012
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Sharing KnowledgE Assets: InteRegionally Cohesive NeigHborhoods (SEARCH)
Comparative View of the Quality of National
Institutional Environments
Background
The Research (based on SEARCH program WP5.3) focuses on features of institutions at the national level
(due to the lack of data at the regional level). The quality of institutions relies mainly on qualitative
assessment and is not easy to measure (Kaufmann et al. 2008). World Economic Forum provides a solid
base of common indicators and empirical data based on a sample of qualified professionals of the business
sector reflecting their perceptions as actors in different institutional environment. The aforementioned
indicators are particularly useful because they are common for all countries in a period from 2004-2011,
covering key features of institutional performance.
Main aspects of institutional performance that will be examined are: a. Government Effectiveness , b.
Regulatory Quality, c. Rule of Law d. Control of Corruption (Jurlin K./ Cuckovic, N.: 2009)
The aim of this research exercise is to highlight trends of institutional performance across time for selected
countries which are grouped in clusters according to the pace of Europeanization: EU countries (e.g.
Greece, Romania, Bulgaria), candidate countries (e.g. Turkey, Croatia) .Furthermore, trends will be
examined according to different geographical cooperation countries (e.g. Black Sea countries, Southern
Mediterranean NC, Eastern NC). Furthermore, convergencies or divergencies among countries of the same
group will be examined in the period (2004-2011) using the coefficient of variation.
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Sharing KnowledgE Assets: InteRegionally Cohesive NeigHborhoods (SEARCH)
Comparative View of the Quality of National Institutional
Environments
Assumptions
•Different national institutional frameworks influence the Europeanization process ( e.g.
Heritier, Guallini, Bach, Paraskevopoulos/Getimis/ Riss et. al.) .Divergent processes of
Europeanization in different countries and macro-regions reflect “Goodness of Fit” or “MissFit”, along line different responses of domestic legal and regulatory structures to the
“European Community aquis”.
•The main thesis is that “path-dependency” influences the changes and transformations of
the legal and administrative structures, which are promoted by the European programmes
and the co-operation agreements in Macro-Regions (e.g. Black Sea Conventions and
multi-lateral agreements). Thus, different trajectories of change emerge, with different paces
and velocities, while traditional structures and practices co-exist with innovative
modernization efforts. In any case, most of the evaluation reports highlight that even in
cases of legal compliance, implementation of policies is lagging behind.
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Sharing KnowledgE Assets: InteRegionally Cohesive NeigHborhoods (SEARCH)
Comparative View of the Quality of National Institutional
Environments
Hypotheses
1. EU member states (e.g. Gr., Bu., Ro.), through the Europeanization process, show better
institutional performance than candidate countries (e.g. Turkey, Croatia).
2. Candidate countries move more close to a trajectory of “goodness of Fit” than other NC Black sea
countries.
3. Every country has its “significant trajectory” of institutional performance. Other factors, than
Europeanization, play also an important role.
4. Countries with a political and administrative culture closer to the “weberian” bureaucracy of middle
Europe (e.g. Croatia) do better than countries with individual political culture, clientelism and
personalized networks (e.g. Bulgaria, Greece).
5. In general, Europeanization Process and ENPI can promote improvement of national institutional
environment and convergence of performance across countries.
6. Better performance of national institutional environments goes alongside with better scores in
competitiveness of national economy.
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Sharing KnowledgE Assets: InteRegionally Cohesive NeigHborhoods (SEARCH)
Comparative View of the Quality of National
Institutional Environments
Main research questions
•Which different trajectories concerning institutional performance emerge alongside
single countries or clusters of countries (Europeanization, Regional Cooperation)
•What kinds of differences by aspects of institutional performance between EU, EU
Candidates, BSEC and ENP countries?
Data sources
•The main source is the World Economic Forum (The Global Competitiveness Report,
Issues 2004-2011)
Methodology
•Analysis and evaluation of selected institutional indicators using aforementioned data
source.
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Sharing KnowledgE Assets: InteRegionally Cohesive NeigHborhoods (SEARCH)
Comparative View of the Quality of National
Institutional Environments
Selected Indicators from WEF:
1. Government Effectiveness
1.1 Public trust of politicians
1.2 Favoritism in decisions of government officials
1.3 Wastefulness of government spending
1.4 Burden of government regulation
2. Regulatory Quality
2.1 Efficiency of legal framework
2.2. Transparency of government policy making
2.3. Strength of auditing and reporting standards
2.4. Efficacy of corporate boards
2.5. Protection of minority shareholders’ interests
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Sharing KnowledgE Assets: InteRegionally Cohesive NeigHborhoods (SEARCH)
Comparative View of the Quality of National
Institutional Environments
Selected Indicators from WEF:
3. Rule of Law
3.1 Property rights
3.2 Intellectual property protection
3.3 Judicial independence
3.4 Business costs of terrorism
3.5 Business costs of crime and violence
3.6 Organized crime
3.7 Reliability of police services
4. Control of Corruption
4.1 Diversion of public funds
4.2 Ethical behavior of firms
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Sharing KnowledgE Assets: InteRegionally Cohesive NeigHborhoods (SEARCH)
Comparative View of the Quality of National
Institutional Environments
Literature Background
1.
2.
3.
4.
5.
6.
Jurlin, K./ Cuckovic, N. (2009). Comparative Analysis of the Quality of Institutions in the European
Countries, Associzione Italiana per lo Studio dei Sistemi Economici Comparati, XIIth Scientific
Conference, Growth and Development Patterns: The Role of Institutions in a Comparative Perspective,
University of Perugia, Perugia.
Kaufmann, D., Kraay, A., Mastruzzi, M. (2008). Governance matters: Aggregate and Individual
Governance Indicators, 1996-2007. World Bank Policy Research Working Paper, No 4654, available at
SSRN: http//ssrn.com/abstract=1148386.
Heritier, Adr. (2005) , Europeanization Research East and West: A Comparative Assessment, in:
Schimmelfennig, Fr. , Sedelmeier, Ulr. (ed.), The Europeanization of Central and Eastern Europe,
Ithaca, NY, Cornell University Press, 199-209.
Gualini, E. (guest ed.) (2006), European Planning Studies, Vol. 14, No. 7: ‘Governance Rescaling in
Europe: Analytical and Empirical Explorations’
Bache, I., Marshall, Ad. (2004), Europeanisation and Domestic Change: A Governance Approach to
Institutional Adaptation in Britain. IES Queen's University of Belfast: Queen's Papers on
Europeanisation.
Paraskevopoulos, Chr./ Getimis, P./ Rees, N. (2006): Adapting to EU Multi-Level Governance Regional
and Environmental Policies in Cohesion and CEE Countries, Ashgate, Aldershot.
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Sharing KnowledgE Assets: InteRegionally Cohesive NeigHborhoods (SEARCH)
Index of Quality of Institutional Environment
5,5
EU 15
5,0
EU 27
4,5
Candidate countries
4,0
ENC total
East ENC
3,5
South ENC
3,0
BSEC
2,5
2004
2006
2008
2010
2011
Government Effectiveness - Candidate coutnries
110,0
100,0
Croatia
Macedonia, FYR
90,0
Montenegro
80,0
Serbia
70,0
Turkey
EU 15
60,0
50,0
2004
2006
2008
2010
2011
Regulatory Quality - Candidate countries
110,0
100,0
Croatia
Macedonia, FYR
90,0
Montenegro
80,0
Serbia
70,0
Turkey
EU 15
60,0
50,0
2004
2006
2008
2010
2011
Rule of Law - Candidate countries
110,0
100,0
Croatia
90,0
Macedonia, FYR
80,0
Montenegro
70,0
Serbia
Turkey
60,0
EU 15
50,0
40,0
2004
2006
2008
2010
2011
Control of Corruption - Candidate countries
110,0
100,0
Croatia
90,0
Macedonia, FYR
80,0
Montenegro
70,0
Serbia
Turkey
60,0
EU 15
50,0
40,0
2004
2006
2008
2010
2011
Index of Quality of Institutional Environment Candidate countries
110,0
100,0
Croatia
Macedonia, FYR
90,0
Montenegro
80,0
Serbia
70,0
Turkey
EU 15
60,0
50,0
2004
2006
2008
2010
2011
Government Effectiveness - BSEC
110.0
Albania
Armenia
100.0
Azerbaijan
Bulgaria
90.0
Georgia
Greece
80.0
Moldova
Romania
70.0
Russian Federation
Serbia
60.0
Turkey
Ukraine
50.0
2004
2006
2008
2010
2011
EU 15
Regulatory Quality - BSEC
110.0
Albania
Armenia
100.0
Azerbaijan
Bulgaria
90.0
Georgia
Greece
80.0
Moldova
Romania
70.0
Russian Federation
Serbia
60.0
Turkey
Ukraine
50.0
2004
2006
2008
2010
2011
EU 15
Rule of Law - BSEC
110.0
Albania
Armenia
100.0
Azerbaijan
Bulgaria
90.0
Georgia
Greece
80.0
Moldova
Romania
70.0
Russian Federation
Serbia
60.0
Turkey
Ukraine
50.0
2004
2006
2008
2010
2011
EU 15
Control of Corruption - BSEC
110.0
Albania
Armenia
100.0
Azerbaijan
90.0
Bulgaria
Georgia
80.0
Greece
Moldova
70.0
Romania
Russian Federation
60.0
Serbia
50.0
Turkey
Ukraine
40.0
EU 15
2004
2006
2008
2010
2011
Index of Quality of Institutional Framework - BSEC
110.0
Albania
Armenia
100.0
Azerbaijan
Bulgaria
90.0
Georgia
Greece
80.0
Moldova
Romania
70.0
Russian Federation
Serbia
60.0
Turkey
Ukraine
50.0
2004
2006
2008
2010
2011
EU 15
Government Effectiveness - ENC East
120.0
100.0
Armenia
Azerbaijan
80.0
Belarus
60.0
Georgia
Moldova
40.0
Ukraine
EU 15
20.0
0.0
2004
2006
2008
2010
2011
Regulatory Quality - ENC East
105.0
100.0
95.0
Armenia
90.0
Azerbaijan
Belarus
85.0
Georgia
80.0
Moldova
75.0
Ukraine
70.0
EU 15
65.0
60.0
2004
2006
2008
2010
2011
Rule of Law - ENC East
110.0
100.0
Armenia
Azerbaijan
90.0
Belarus
80.0
Georgia
Moldova
70.0
Ukraine
EU 15
60.0
50.0
2004
2006
2008
2010
2011
Control of Corruption - ENC East
110.0
100.0
Armenia
90.0
Azerbaijan
80.0
Belarus
Georgia
70.0
Moldova
60.0
Ukraine
EU 15
50.0
40.0
2004
2006
2008
2010
2011
Index of Quality of Institutional Framework - ENC East
110.0
100.0
Armenia
Azerbaijan
90.0
Belarus
80.0
Georgia
Moldova
70.0
Ukraine
EU 15
60.0
50.0
2004
2006
2008
2010
2011
Government Effectiveness - ENC South
140.0
130.0
Algeria
Egypt
120.0
Israel
110.0
Jordan
Lebanon
100.0
Libya
90.0
Morocco*
Syria
80.0
Tunisia
70.0
EU 15
60.0
2004
2006
2008
2010
2011
Regulatory Law - ENC South
110.0
Algeria
105.0
Egypt
100.0
Israel
95.0
Jordan
90.0
Lebanon
85.0
Libya
80.0
Morocco*
75.0
Syria
70.0
Tunisia
65.0
EU 15
60.0
2004
2006
2008
2010
2011
Rule of Law - ENC South
110.0
Algeria
Egypt
100.0
Israel
90.0
Jordan
Lebanon
80.0
Libya
Morocco*
70.0
Syria
60.0
Tunisia
EU 15
50.0
2004
2006
2008
2010
2011
Conrol of Corruption - ENC South
110.0
Algeria
100.0
Egypt
90.0
Israel
Jordan
80.0
Lebanon
70.0
Libya
Morocco*
60.0
Syria
Tunisia
50.0
EU 15
40.0
2004
2006
2008
2010
2011
Index of Quality of Institutional Framework ENC South
110.0
105.0
Algeria
100.0
Egypt
95.0
Israel
Jordan
90.0
Lebanon
85.0
Libya
80.0
Morocco*
75.0
Syria
70.0
Tunisia
65.0
EU 15
60.0
2004
2006
2008
2010
2011
Government Effectiveness - ENC Total
Armenia
Algeria
Azerbaijan
140.0
Belarus
130.0
Egypt
120.0
Georgia
110.0
Israel
100.0
Jordan
90.0
Lebanon
80.0
Libya
70.0
Moldova
Morocco*
60.0
Syria
50.0
Tunisia
40.0
2004
2006
2008
2010
2011
Ukraine
EU 15
Regulatory Quality - ENC Total
Armenia
Algeria
Azerbaijan
110.0
Belarus
105.0
Egypt
100.0
Georgia
95.0
Israel
90.0
Jordan
85.0
Lebanon
80.0
Libya
75.0
Moldova
Morocco*
70.0
Syria
65.0
Tunisia
60.0
2004
2006
2008
2010
2011
Ukraine
EU 15
Armenia
Rule of Law - ENC Total
Algeria
Azerbaijan
110.0
Belarus
Egypt
100.0
Georgia
90.0
Israel
Jordan
80.0
Lebanon
70.0
Libya
Moldova
60.0
Morocco*
50.0
Syria
Tunisia
40.0
2004
2006
2008
2010
2011
Ukraine
EU 15
Control of Corruption - ENC Total
Armenia
Algeria
Azerbaijan
110.0
Belarus
Egypt
100.0
Georgia
90.0
Israel
Jordan
80.0
Lebanon
70.0
Libya
Moldova
60.0
Morocco*
50.0
Syria
Tunisia
40.0
2004
2006
2008
2010
2011
Ukraine
EU 15
Index of Quality of Institutional Framework ENC Total
Armenia
Algeria
Azerbaijan
Belarus
110.0
Egypt
Georgia
100.0
Israel
90.0
Jordan
Lebanon
80.0
Libya
Moldova
70.0
Morocco*
60.0
Syria
Tunisia
50.0
2004
2006
2008
2010
2011
Ukraine
EU 15
Coefficient of variation of the index of Quality of
Institutional Environment
25.0
EU 15
20.0
EU 27
Candidate countries
15.0
ENC total
10.0
East ENC
South ENC
5.0
BSEC
0.0
2004
2006
2008
2010
2011
Relation of GCI with QIEI - BSEC
4,20
4,00
3,80
Global Competitiveness
Index
3,60
Quality of Institutional
Environment Index
3,40
3,20
3,00
2004
2006
2008
2010
2011
Relation of GCI with QIEI - ENC East
4,10
3,90
3,70
Global Competitiveness
Index
3,50
3,30
Quality of Institutional
Environment Index
3,10
2,90
2,70
2,50
2004
2006
2008
2010
2011
Relation of GCI with QIEI - Candidate countries
4,20
4,00
3,80
Global Competitiveness
Index
3,60
Quality of Institutional
Environment Index
3,40
3,20
3,00
2004
2006
2008
2010
2011
Relation of GCI with QIEI BSEC / ENC East / Candidate coutnries
4,20
4,00
BSEC GCI
3,80
BSEC QIEI
3,60
ENC East GCI
3,40
ENC East QIEI
Candidate GCI
3,20
Candidate QIEI
3,00
2,80
2004
2006
2008
2010
2011
Relation of GCI with QIEI - Candidate countries
5.00
Croatia GCI
Croatia QIEI
4.50
Macedonia, FYR GCI
Macedonia, FYR QIEI
4.00
Montenegro GCI
Montenegro QIEI
3.50
Serbia GCI
Serbia QIEI
3.00
Turkey GCI
Turkey QIEI
2.50
2004
2006
2008
2010
2011
Relation of GCI with QIEI - East ENC
4.5
Armenia GCI
4.3
Armenia QIEI
4.1
Azerbaijan GCI
3.9
Azerbaijan QIEI
3.7
Belarus GCI
3.5
Belarus QIEI
3.3
Georgia GCI
3.1
Georgia QIEI
Moldova GCI
2.9
Moldova QIEI
2.7
Ukraine GCI
2.5
2004
2006
2008
2010
2011
Ukraine QIEI
Relation of GCI with QIEI - Selected BSEC countries
Bulgaria GCI
Bulgaria QIEI
5.0
Greece GCI
Greece QIEI
4.5
Romania GCI
Romania QIEI
Serbia GCI
4.0
Serbia QIEI
Turkey GCI
3.5
Turkey QIEI
Albania GCI
Albania QIEI
3.0
Moldova GCI
Moldova QIEI
2.5
2004
2006
2008
2010
2011
Ukraine GCI
Ukraine QIEI
Comparative View of the Quality of National Institutional
Environments
Conclusions
1. In total, EU-15 shows better institutional performance than candidate
countries, but this is not the case for BSCEC-EU members (Greece,
Bulgaria, Romania), compared to some candidate countries (e.g.
Montenegro). It is worth mentioning that institutional performance of Greece
worsened a lot since 2005
2. Candidate countries do not necessarily move more close to a trajectory of
“goodness of Fit” than other NC Black sea countries.
3. It is true, that every country has its “significant trajectory” of institutional
performance. Other factors, than Europeanization, play also an important
role (s. the case of Greece).
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Sharing KnowledgE Assets: InteRegionally Cohesive NeigHborhoods (SEARCH)
Comparative View of the Quality of National Institutional
Environments
Conclusions (II)
4. Countries with a political and administrative culture closer to the “weberian” bureaucracy
of middle Europe (e.g. Croatia) do not necessarily do better than countries with individual
political culture, clientelism and personalized networks (e.g. Bulgaria, Greece, Turkey).
5. In general, it could not be indicated that Europeanization Process and ENPI can promote
improvement of national institutional environment. Positive tendencies could be stated in
Candidate, East ENC and (till 2008) BSEC countries. Developments in global economy and
national contexts seem to be more influential
6. Convergence of performance across these selected groups of countries and within these
groups could be stated.
7. Better performance of institutional environments does go alongside with better scores in
competitiveness of economy.
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Sharing KnowledgE Assets: InteRegionally Cohesive NeigHborhoods (SEARCH)