Civil Liberties, Democracy, and the Performance of Government Projects

22 Pages Posted: 5 Apr 2008

See all articles by Jonathan Isham

Jonathan Isham

Middlebury College - Department of Economics

Daniel Kaufmann

Results for Development; The University of the Philippines Diliman; The Brookings Institution

Lant Pritchett

Harvard University - Harvard Kennedy School (HKS); Center for Global Development

Abstract

This article uses a cross-national data set on the performance of government investment projects financed by the World Bank to examine the link between government efficacy and governance. It demonstrates a strong empirical link between civil liberties and the performance of government projects. Even after controlling for other determinants of performance, countries with the strongest civil liberties have projects with an economic rate of return 8-22 percentage points higher than countries with the weakest civil liberties. The strong effect of civil liberties holds true even when controlling for the level of democracy. The interrelationship among civil liberties, civil strife, and project performance suggests that the possible mechanism of causation is from more civil liberties to increased citizen voice to better projects. This result adds to the evidence for the view that increasing citizen voice and public accountability - through both participation and better governance - can lead to greater efficacy in government action.

Suggested Citation

Isham, Jonathan and Kaufmann, Daniel and Pritchett, Lant, Civil Liberties, Democracy, and the Performance of Government Projects. World Bank Economic Review, Vol. 11, No. 2, pp. 219-242, May 1997, Available at SSRN: https://ssrn.com/abstract=1116669

Jonathan Isham

Middlebury College - Department of Economics ( email )

Munroe Hall
Middlebury, VT 05753
United States
802-433-3238 (Phone)

Daniel Kaufmann (Contact Author)

Results for Development ( email )

1875 Connecticut Avenue, NW, Suite 1210
Washington, DC 20009
United States

HOME PAGE: http://https://r4d.org/about/our-team/daniel-kaufmann/

The University of the Philippines Diliman ( email )

Manila
Philippines

The Brookings Institution ( email )

1775 Massachusetts Avenue, NW
Washington, DC 20036
United States

HOME PAGE: http://www.brookings.edu/experts/kaufmannd

Lant Pritchett

Harvard University - Harvard Kennedy School (HKS) ( email )

79 John F. Kennedy Street
Cambridge, MA 02138
United States
617-496-4562 (Phone)
617-496-2554 (Fax)

HOME PAGE: http://ksghome.harvard.edu/~lpritch/

Center for Global Development

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5th floor
Washington, DC 20036
United States