Chapter 7 PDF
Chapter 7 PDF
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Evert Pommer and Pepijn van Houwelingen
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public administration
Table 7.1 Outcome, system, input and trust indicators used in this chapter and corresponding data sources
public administration, nor are bodies responsible for external affairs and
diplomatic duties. Activities producing individual services for citizens,
such as health care and education, do not belong to the domain of public
administration.
256
public sector achievement in 36 countries
257
public administration
258
public sector achievement in 36 countries
259
public administration
Table 7.2 Elements of various codes of (and instruments to measure) good governance
World Bank United Nations Dutch Ministry of the Interior Council of Europe
Voice and accountability Transparency Appropriate contact with the public Parliamentary democracy
Control of corruption Responsiveness Openness and integrity Transparency, responsiveness
and accountability
Rule of law Participation Participation Participation and civic society
Government effectiveness Rule of law Effectiveness and efficiency Representation
Political Stability and absence Effectiveness and efficiency Legitimacy (rule of law) Sub-national democracy and
violence of subsidiarity
Regulatory quality Consensus-oriented Capacity for learning and self-
improvement
Equity and inclusiveness Accountability
Source: World Bank, United Nations, Council of Europe, Dutch Ministry of the Interior.
Within public administration there are several processes that deliver ser-
vices to citizens, such as the issuing of passports and driving licences,
issuing work permits and residence permits to foreigners, and tax admin-
istration. The codes for good governance comprise various elements (see
Table 7.2). Some elements are found in numerous codes (rule of law, partic-
ipation), whereas others are only mentioned in one.
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public sector achievement in 36 countries
261
public administration
Table 7.3 Relationship between the six indicators of good governance, 1996 (right of diagonal) and 2013 (left of diagonal)
The World Bank has been collecting information on these six governance
indicators since 1996. Based on the scores, countries are ranked from 0 to
100. The scores are normalised according to a [0,1] distribution with mean
= zero and variance = 1. It is therefore mainly relative positions that should
be considered, both between countries and over time.
These indicators are highly correlated, with correlation coefficients that
often exceed 0.9 (Rothstein 2011: 35). This indicates that one and the same
latent construct, in this case quality of government, is measured by these
different indicators (see Table 7.3).
Not only are correlations high (mean score 0.79 in 1996 and 0.76 in 2013),
but they have changed over time. In particular, the relationship between
accountability and effectiveness of government is strengthened, as is the
relationship between political stability and effectiveness of government.
On the other hand, the relationship between rule of law and control of
corruption has weakened over time.
We will use the six World Bank ‘good governance’ indicators to construct a
single outcome index for public administration. This public administration
outcome index therefore reflects accountability, control of corruption, rule
of law, government effectiveness, political stability and regulatory quality
in our selected countries. The index scores are presented in Figure 7.1.a
(original composite index) and Figure 7.1.b (standardised index scores).
262
public sector achievement in 36 countries
Region Country
Western Switzerland
Europe
Luxembourg
Netherlands
Austria
Germany
Ireland
United Kingdom
Belgium
France
Northern Finland
Europe
Norway
Sweden
Denmark
Southern Malta
Europe
Cyprus
Portugal
Spain
Italy
Greece
Central and Estonia
Eastern
Czech Republic
Europe
Slovenia
Poland
Lithuania
Slovak Republic
Latvia
Hungary
Croatia
Romania
Bulgaria
Oceania New Zealand
Australia
Northern Canada
America
United States
Eastern Japan
Asia
Korea
-3 0 3 6 9 12
Source: World Bank. voice & political effectiveness regulatory rule of control of
accountability stability quality law corruption
263
public administration
Region Country
Western Switzerland
Europe
Luxembourg
Netherlands
Austria
Germany
Ireland
United Kingdom
Belgium
France
Northern Finland
Europe
Norway
Sweden
Denmark
Southern Malta
Europe
Cyprus
Portugal
Spain
Italy
Greece
Central and Estonia
Eastern
Czech Republic
Europe
Slovenia
Poland
Lithuania
Slovak Republic
Latvia
Hungary
Croatia
Romania
Bulgaria
Oceania New Zealand
Australia
Northern Canada
America
United States
Eastern Japan
Asia
Korea
-2 -1 0 1 2
Notes: The outcome index combines the six World Bank good governance indicators that reflect accountability, control of corruption, rule of law, govern-
ment effectiveness, political stability and regulatory quality in our selected countries. It is constructed as follows. First, we identify the 24 countries with
available outcome data for all sectors: AT, BE, DE, FR, GB, IE, LU, NL, DK, FI, SE, ES, IT, PT, BG, CZ, EE, HU, LT, LV, PL, RO, SI, and SK. We calculate the 2013 mean and
standard deviation of the combined six good governance indicators for this reference group of 24. We then compute standardised 2013 scores by subtracting
the mean and dividing by the standard deviation. Source: World Bank (SCP treatment).
264
public sector achievement in 36 countries
12
totaal 2013
FI
NO
SE NZ
10.5 CH DK
LU NL
AU CA
AT
9
DE
GB
JP BE IE
7.5 US
MT
EE
FR
6 PT
CY
CZ SI
LT PL
4.5 LV KR ES
SK HU
IT
3 HR
GR
1.5
BG RO
0
-2 0 2 4 6 8 10 12
totaal 1996
Source: World Bank Worldwide Governance Indicators (WGI).
Within the Western European countries, France and the United Kingdom
are characterised by less political stability. The same applies for the United
States. Greece is the worst-performing Southern European country, main- 5
Corruption is a ‘wicked
ly because of the very limited control of corruption.5 But other aspects problem’ because it
of good governance also score rather poorly in Greece, as well as in Italy. is self-reinforcing. In
Among the Eastern European countries, the newly acceded eu Member that sense it is similar
to the ‘safety paradox’
States Bulgaria and Romania still have a long way to go to achieve good mentioned in Chapter 4.
governance. Control of corruption is a particularly weak aspect of govern- When people perceive
other people to be
ment performance in these countries, as is the implementation of the rule
corrupt, they will them-
of law. selves tend to behave in
a corrupt manner. This
is also often the only
We now discuss the change of relative positions of countries. Since 1996 manner in which people
the good governance scores have declined slightly overall in Western can sustain themselves
Europe and increased somewhat in Northern Europe (Figure 7.2). The in a corrupt system: if
everyone is a free-rider, it
Southern European countries Greece, Italy, Spain and Portugal have seen a is only rational to become
considerable decrease in their government performance, while the Baltic a free-rider oneself.
265
public administration
states (Estonia, Latvia and Lithuania) and some Eastern European countries
(Slovak Republic, Poland) have been able to increase their government
performance. The same can be said of Japan and Korea. Finally, the North-
ern European countries (Finland, Norway, Sweden and Denmark) and New
Zealand have consolidated their (high) scores, followed at some distance
by Switzerland, the Netherlands and Luxembourg.
The most noteworthy feature in Figure 7.2 in our view is the deterioration
in the relative position of most Southern European countries. In Greece,
the decrease in good governance occurred mainly in the period 2005-
2010, especially on political stability (–0.6 se units), control of corruption
(–0.5 se units) and regulatory quality (–0.3 se units). In Italy, control of
corruption has decreased the most, in Spain political stability and in
Portugal regulatory quality. These Southern European countries share an
authoritarian past and, as a result of this shared history, a similar process
of democratisation. Efforts to modernise public administration can be
hampered by the various legacies associated with the struggle to overcome
this authoritarian past (Galanti 2011). According to Galanti (2011) Southern
European bureaucracies are characterised by formalism and legalism in
terms of structures and civil servants’ behaviour, political and adminis-
trative clientelism, uneven development and unbalanced distribution of
human resources and a lack of administrative élites, especially in Greece,
Italy and Portugal.
Finland has improved its governance score through better regulatory qual-
ity, and Sweden by excluding corruption. Thus even countries with high
levels of good governance can improve their performance. The changes in 6
The cpi is the most
good governance in different periods are shown in Table 7.4. well-known measure of
corruption. The cpi is based
on expert assessments
Good governance is of course a very broad and general term. We will
and opinion surveys.
therefore look more closely at a few specific aspects of good governance Countries must have been
(Table 7.5). We will start with corruption. Using different data sources assessed by three sources
before they are included
based on various expert surveys, Transparency International constructs in the index. The cpi has
an annual ‘Corruption Perceptions Index’ (cpi).6 This index, together been criticised because
with the Global Corruption Barometer (gcb), a survey developed by the it relies on the opinion of
a small group of experts,
same organisation and conducted among more than 114,000 citizens in possibly introducing an
107 countries, provides one of the best overviews of corruption availa- ‘elite bias’ (Cobham 2013).
ble. According to the cpi 2014, Denmark has the lowest corruption, and Others have questioned
the aim of capturing
the other Scandinavian countries also have very low corruption levels. corruption in one number
Corruption in Western Europe, Northern America and Oceania is also quite (The Economist 2010). On
the other hand, Wilhelm
low. Southern, Central and Eastern Europe, on the other hand, are plagued
(2002) has compared the
by a considerable amount of corruption. cpi to two other measures
of corruption and found
a strong and significant
If we compare the Transparency International cpi index with the World correlation between
Bank wgi index, the ranking of countries based on the level of corrup- these three measures
tion seems to be quite similar; only the ranking of Malta differs by a few of corruption. This is an
indication of the validity
positions. Both indices thus seem to measure the same kind and level of of the cpi (and the other
corruption. This is less the case with the Global Competitiveness Report two measures).
266
public sector achievement in 36 countries
Table 7.4 Good governance scores, changes between 1996 and 2013
For reading
instructions Region Country 1996 2000 2005 2010 2013 2013 2013 vs 1996
see page 49
-5 0 5 10 15
267
public administration
Western Austria
Europe
Belgium
France
Germany
Ireland
Luxembourg
Netherlands
Switzerland
United Kingdom
Northern Denmark
Europe
Finland
Norway
Sweden
Southern Cyprus
Europe
Greece
Italy
Malta
Portugal
Spain
Central and Bulgaria
Eastern
Croatia
Europe
Czech Republic
Estonia
Hungary
Latvia
Lithuania
Poland
Romania
Slovak Republic
Slovenia
Oceania Australia
New Zealand
Northern Canada
America
United States
Eastern Japan
Asia
Korea
Corruption Perception Index 2014 (Transparency International). b Global Competitiveness Report 2014, Question: “In your country, how common is diversion of
public funds to companies, individuals, or groups due to corruption? c Global Competitiveness Report 2014, Question: “In your country, how e.ciently does the
government spend public revenue? d Global Compe.iiveness Report 2014, question: “In your country, how burdensome is it for business to comply with govern-
ment administrative requirements (e.g., permits, regulations and reporting e World Bank Worldwide Governance
268
public sector achievement in 36 countries
269
public administration
Figure 7.3 United Nations e-Government readiness index (e-GRI), 2004 and 2014
1.0
2014
KR
FR JP
0.9
NL AU
GB US
FI CA
ES NZ
0.8 EE DK
LU AT DE NO SE
IT
IE BE
0.7
LT
LV
PT CH
0.6
GR
HR HU MT
SK SI
CY PL
0.5
CZ
RO
BG
0.4
0.3 0.4 0.5 0.6 0.7 0.8 0.9
2004
Source: World Bank Worldwide Governance Indicators (WGI).
270
public sector achievement in 36 countries
The World Bank’s index of good governance does not reveal very much
about the business friendliness of public administration. This is a regret-
table weakness because business-friendliness is an important instrument
for promoting economic competitiveness and economic performance
(European Commission, 2014). Since 2014 the World Bank has published an
271
public administration
Region Country
Western Netherlands
Europe
France
Luxembourg
Austria
Belgium
Ireland
United Kingdom
Germany
Switzerland
Northern Denmark
Europe
Norway
Sweden
Finland
Southern Spain
Europe
Portugal
Malta
Greece
Cyprus
Italy
Central and Estonia
Eastern
Slovenia
Europe
Lithuania
Hungary
Slovak Republic
Latvia
Croatia
Poland
Czech Republic
Bulgaria
Romania
Oceania Australia
New Zealand
Northern Canada
America
United States
Eastern Japan
Asia
Korea
0 100 200 300 400 500
Figure 7.5 World Bank business-friendliness index (DBI), 2005 and 2010
100 NZ
2010
DK
CA
GB
95 FI
SE
KR BE IE
DE AU
90 US
NO
FR
85 SI
JP
LT
CY PT NL
80 EE
CH
IT
HU GR
ES
75 LU
BG
LV AT
SK
CZ MT RO
70
HR
65
PL
60
50 55 60 65 70 75 80 85 90 95 100
2005
Source: The QOG Standard Dataset 2015.
273
public administration
Figure 7.6 World bank business-friendliness index (DBI), 2010 and 2015
90
2015
NZ
85 DK
KR
NO US
FI GB
DE
80 EE AU SE
IE
AT CA
LV LT
CH
NL JP
75 PL FR PT
SK
CZ BG ES BE
RO
SI
70 HU
IT
HR GR LU
CY
65
MA
60
60 63 66 69 72 75 78 81 84 87 90
2010
Notes: The data for three out of ten items (obtaining credit, protecting minority Investors and resolving insolvency) are not comparable between
2013 and 2014 due to methodological changes. Source: World Bank, Doing Business 2013 and 2015.
274
public sector achievement in 36 countries
Between 2005 and 2010, great progress was made by some Eastern Europe-
an countries (Croatia, Czech Republic and Slovenia). Austria lost ground in
business-friendliness between 2005 and 2010 (Figure 7.5), but stabilised its
position between 2010 and 2015 (Figure 7.6).
The World Justice Project (wjp) publishes the Rule of Law Index. According
to the wjp the Index is based on two main ideas about the functioning
of the public sector. First, the law has to impose limits on the exercise of
power by the state and its agents, as well as individuals and private entities.
Second, the state limits the actions of members of society and the public
interest is served, people are protected from violence, and members of so-
ciety have access to mechanisms to settle disputes and redress grievances.
The Index is made up of eight dimensions, each of which is measured using
between three and eight indicators, adding up to a total of 47 indicators.
The eight dimensions relate to constraints on government powers, absence
of corruption, open government, fundamental rights, order and security,
regulatory enforcement, civil justice and criminal justice.
According to the wjp the Index is the world’s most comprehensive, and
the only one to rely solely on primary data. We therefore rely on this Index
even though, as stated, the World Bank also has its own ‘Rule of Law’ indi-
cator. Primary data are gathered on 100,000 households (about 1,000 in
each country) using closed-ended questions and a survey of 2,400 experts
(about 25 in each country) worldwide. The indicators are normalised on a
0-1 scale and are summarised unweighted to produce an overall score.
275
public administration
Region Country
Western Netherlands
Europe
Ireland
Austria
Germany
Belgium
France
United Kingdom
Luxembourg
Switzerland
Northern Denmark
Europe
Norway
Sweden
Finland
Southern Portugal
Europe
Malta
Greece
Cyprus
Italy
Spain
Central and Estonia
Eastern
Czech Republic
Europe
Poland
Slovenia
Hungary
Romania
Croatia
Bulgaria
Latvia
Lithuania
Slovak Republic
Oceania Australia
New Zealand
Northern United States
America
Canada
Eastern Korea
Asia
Japan
0 2 4 6 8
Constraints on government powers Order and security
Absence of corruption Regulatory enforcement
Open government Civil justice
Fundamental rights Criminal justice
276
public sector achievement in 36 countries
20
2012
CY
18
16
GR
14 DK
PT
PL
12 IT
10
MT
SE AT
FI SI
DE LV
ES
8
IE CZ
GB NL FR
LU BG
RO
HU NO
6
EE
4
4 6 8 10 12 14 16
2005
Source: Eurostat (no information available for Belgium, Croatia, Lithuania, Slovak Republic,
Switzerland and non-EU countries).
277
public administration
Figure 7.9 Share of general government personnel in total labour force, 2001 and 2011
Region Country
Western France
Europe
Luxembourg
Netherlands
United Kingdom
Ireland
Germany
Switzerland
Austria
Belgium
Northern Norway
Europe
Denmark
Sweden
Finland
Southern Greece
Europe
Spain
Cyprus
Italy
Malta
Portugal
Central and Czech Republic
Eastern
Slovak Republic
Europe
Estonia
Poland
Slovenia
Bulgaria
Croatia
Hungary
Latvia
Lithuania
Romania
Oceania Australia
New Zealand
Northern Canada
America
United States
Eastern Japan
Asia
Korea
-10 0 10 20 30 40
Notes: Data represent the number of employees except for the Czech Republic, the Netherlands and New Zealand, where data represent full-time
equivalents; the general government sector comprises all levels of government, including core ministries, agencies, departments and non-profit
institutions that are controlled and mainly financed by public authorities. Source: OECD (2013).
278
public sector achievement in 36 countries
20
share of administrative expenditure
CY
18
16
GR
14 DK
PT
HU
12 IT
10
MT AT SE
PL
SI DE FI
8 CZ NL
US
LV ES IE
BG FR GB LU
LT EE
6 NO
4
0 2 4 6 8 10 12
good governance
Sources: World Bank, Eurostat, OECD (2013).
279
public administration
40
share of administrative personnel
35 NO
CZ
DK
30
SE
FR LU
25
SI FI
EE NL
GR
GB
20
SK PL
CA
IE
AU
CH
15 ES
DE
NZ
10
0 2 4 6 8 10 12
good governance
Sources: World Bank, Eurostat, OECD (2013).
280
public sector achievement in 36 countries
281
public administration
Figure 7.11 Scoreboard of the best (Finland) and worst (Greece) performing country on public administration
A - Government effectiveness
-0,6
-0,4
F - Tax compliance & C - Corruption
tax administration -0,2 and fraude
0,0
0,2
0,4
0,6
E - Public procurement D - Business start & licences
Notes: The spider graph shows the deviation of summary country scores from the EU average. Positive values indicate better than average performance,
negative values indicate below-average performance in the respective field. Source: European Commission (2012).
282
public sector achievement in 36 countries
6 Level of decentralisation;
7 Intensity of ict expenditure;
8 Traditional versus modern bureaucracies.
All these indicators are related to actual policy questions, and each of
these administrative characteristics may influence the outcomes of public
administration. The first indicator refers to economic welfare. Higher
welfare is one of the enabling factors for better governance because it leads
to political stability, less corruption and a stricter application of the rule of
law. The second indicator, a free press, can be seen as a control mechanism
that makes governments more accountable to the population. The third
indicator should tell us something about the competitiveness of public
sector salaries. Fourthly, better quality of public administrative processes
contributes to better outcomes of public administration. The fifth indica-
tor refers to the efficiency of the tax administration and gives an indication
of total public administration efficiency. The hypothesis is that countries
with efficient tax administrations have an efficient public administration
that generates better public administration outcomes. The same holds for
the seventh indicator on the share of ict expenditure. The sixth indicator is
a measure of decentralisation. In general it is assumed that public activi-
ties are most effective if they are provided by central or local authorities;
mixed regimes seem to be most inefficient. Finally, reforms of the civil ser-
vice using New Public Management tools are expected to generate better
outcomes of public administration.
283
public administration
Figure 7.12 Relationship between good governance a and GDP per capita, 2013
12
good governance
FI NO
NZ SE
DK CH
10 CA NL
AU
AT
GB DE
8 IE
BE US
MT
EE
CY FR
6
PT CZ
PL ES
LT
SI
LV
4
SK
HU IT
HR
GR
2
BG RO
0
10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 55,000 60,000
GDP per head
a ‘Good governance’ for each country is the summarised score for the six separate indicators used to measure good governance by the World Bank.
Source: World Bank (excluding Luxembourg).
challenged (Kurz and Schrank 2007). Albassam (2013) found that a coun-
try’s level of development influences the relationship between governance
and economic growth. He concludes that countries with different levels
of development have different requirements and demands to improve
governance in order to promote economic growth. We should therefore
be cautious with causal interpretations of the relationship between good
governance and economic performance.
The correlation between gdp per capita (in purchasing power in us dol-
lars) and good governance is fairly strong (0.81, excluding the gdp outlier
Luxembourg) (Figure 7.12). Some countries underperform in view of their
income (Italy, Greece, Romania, Bulgaria and United States).
284
public sector achievement in 36 countries
Figure 7.13 Relationship between good governance and freedom of the press, 2013
12
good governance
FI
DK NZ SE
NO CH
10
NL AT CA AU
DE
BE GB
IE JP
8
US
FR MT
EE
CY
6 PT
CZ PL LT SI
KR
ES
4 HU
SK LV
IT
HR GR
2
RO BG
0
5 7.5 10 12.5 15 17.5 20 22.5 25 27.5 30
freedom of press
Source: World Bank (good governance) and Reporters Without Borders (freedom of the press).
285
public administration
As far as public salary levels and their effects on quality of government are
concerned, two very different theories can be formulated. One, which we
could call the ‘Singapore model’, operates on the assumption that public
sector employees should be generously rewarded8 so as to attract the best
and cleverest and to stamp out incentives for corruption: ‘The best-trained
and most enthusiastic officials will not remain committed if they are not
paid adequately’ (Fukuyama 2014: 510-511). The second, what we could call
the ‘Norwegian’ model pays civil servants relatively modestly. The idea is
that civil servants should be intrinsically motivated to work for the public
good and should not isolate themselves from their fellow citizens and the
public services they provide, and should not be increasing costs of provid-
ing those services by receiving high salaries. Of course, both Singapore and
Norway enjoy a robust and high quality of government. According to the
World Bank Government Effectiveness Index, Norway is in the top 2% and
Singapore the top 1% of the most effective governments in the world.9 Both
high and modest public salary levels apparently can therefore produce ef-
fective governments.
286
public sector achievement in 36 countries
Figure 7.14 Salaries of public administrators relative to GPD per capita, 2011
Region Country
0 2 4 6 8 10
287
public administration
attractions: public sector employees are also attracted to the job security
and the chance to do something useful for society (Lewis and Frank 2002).
Based on oecd data, we looked for correlations between senior-level public
sector pay and a total of 14 public sector-related outcomes for 28 of our in
total of 36 selected countries: infant mortality, pisa scores, corruption,
trust, youth unemployment, etc.. Without exception, the correlations are
low (below 0.4) and not statistically significant. However, ten of the total
of 14 correlations investigated were negative, indicating that higher pub-
lic salaries tend to coincide with decreasing public sector performance.
Increasing public sector pay therefore does not seem to guarantee better
public sector results.
Salaries are not related to public administration performance indicators.
Apparently, rewarding civil servants better does not influence public
administration outcomes.
The data used by Galanti (2011) to measure the quantitative aspects of the
quality of the bureaucracy are derived from generally accessible sources.
Structural differentiation is analysed more qualitatively/descriptively. This
requires extensive analysis of policy documents and regulation. Ability is
288
public sector achievement in 36 countries
Peter Evans and James Rauch did pioneering work in collecting informa-
tion through surveys about bureaucracies from various countries for the
period 1970 – 1990 (see Rauch and Evans 2000; Evans and Rauch 1999).10
The Quality of Government institute continued this approach, incorporat-
ing more countries.11 The starting point is that the employment system in
the public sector offers a useful means of classifying public bureaucracies
in comparable public administrations. Dahlström et al. (2011) collected
eight items representing the main employment-related characteristics of
a Weberian bureaucracy. Based on a factor analysis of this dataset, they
distinguish between three dimensions of bureaucracy: professionalism,
closeness and salaries. Professionalism concerns the extent to which
bureaucracies are ‘professional’ as opposed to ‘politicised’. Closeness
monitors the presence of barriers to entering (or leaving) the civil service.
In closed systems, public employees enter the administration through
formalised civil service entry examinations, enjoy lifelong tenure and
are frequently managed by self-regulated, autonomous administrative
bodies. Professional administrations are characterised by meritocrat-
ic recruitment, internal recruitment of senior officials and absence of
political appointments of civil servants. The two dimensions identified
by Dahlström et al. relate to Galanti’s (2011) competence and autonomy
dimensions. Although the authors initially propose only these two dimen-
sions, their empirical findings suggest that ‘salaries’ comprise a third,
separate dimension. This dimension refers to the competitiveness of sala-
ries in the public administration compared to the private sector. Although
this approach does not measure quality of bureaucracy, it does provide
important information on distinguishing characteristics of bureaucracies 10
which can be helpful in explaining differences in performance between http://econweb.ucsd.
edu/~jrauch/research_
countries. Information from Dahlström et al. (2011) can be used to deter- bureaucracy.html
mine how the bureaucracies of the various countries can be characterised. 11
Since professional and open bureaucracies are supposed to perform better, http://www.qog.
pol.gu.se/data/
we reversed the sign of closeness in order to produce the dimension ‘open- datadownloads/
ness’. The relationship between the openness of the public administration qogbasicdata/
and good governance is rather weak (0.31), but the relationship between
the professionalism of public administration and good governance is very
289
public administration
Figure 7.15 Relationship between good governance a and level of professionalism of public administration, 2013
12
good governance
FI
SE NO NZ
NL
DK
10
AU CH
AT
CA
IE
BE
DE JP
8 GB
US
MT
CY EE FR
6
SI CZ PT
ES LT
PL
KR
LV
4
SK
HU
HR
IT
GR
2
BG RO
0
2 2.5 3 3.5 4 4.5 5 5.5 6 6.5
professionalism
a ‘Good governance’ for each country is the summarised score for the six separate indicators used to measure good governance by the
World Bank. Source: World Bank (good governance) and Dahlström et al. (professionalism).
290
public sector achievement in 36 countries
Figure 7.16 Relationship between good governance a, 2013, and cost of taxation (% of tax revenue
collected)b, 2012
12
good governance
FI
NO
CH
SE NL
DK
10
AT
DE
IE
8 GB BE
MT FR
EE
6 PT
SI CY CZ PL
LT
ES LV SK
4
IT HU
HR
RO BG
0
0.4 0.6 0.8 1 1.2 1.4 1.6 1.8 2
inefficient rather than effective outcomes. The same probably holds for
public administration, where the financial input as a share of gdp is neg-
atively correlated with good governance (-0.20) and business-friendliness
(-0.31). For example, Greece (and to a lesser degree Italy and Hungary)
spends a good deal on public administration but performs poorly on
good governance; on the other hand, Norway (and to a lesser extent
Finland and Sweden) spends little but performs well. The same applies
for business-friendliness.
Even more striking is the negative relationship between the cost of tax
collection and good governance (Figure 7.16).
Countries with lower tax collection costs perform better than countries
with higher costs, although the correlation is not strong (-0.45). This rela-
tionship probably expresses the fact that efficiency generally corresponds
with good performance. This interdependence, where ‘all good things
come together’, indicates that building a good public administration where
none yet exists is an example of a so-called ‘wicked problem’ (Menkhaus
2010). Hauner and Kyobe (2008) conclude in a meta-study that throwing
money at problems, particularly in the education and health sectors, often
fails to yield the expected improvement in public services if not bolstered
by efficiency-enhancing policies.
291
public administration
Figure 7.17 Share of central government expenditure (including social security spending) in
total government expenditure, 1995 and 2012
0.9
2012
GR
BG
0.8 BE
0.7
IT
LT
0.6
ES
PT NL LU FR
DE
RO HU
0.5
SI
SK CY
FI
AT
DK
0.4
LV
0.3 SE
EE
CZ IE
0.2
0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8
1995
Source: Eurostat (no data available for Croatia, Malta, Norway, Poland, Switzerland, United Kingdom and
non-European countries).
292
public sector achievement in 36 countries
Figure 7.18 Share of local and state expenditure in total government expenditure, 2001 and 2013
Region Country
Western Switzerland
Europe
Germany
Belgium
Austria
Netherlands
United Kingdom
France
Luxembourg
Ireland
Northern Denmark
Europe
Sweden
Finland
Norway
Southern Spain
Europe
Italy
Portugal
Greece
Cyprus
Malta
Central and Estonia
Eastern
Czech Republic
Europe
Slovenia
Slovak Republic
Hungary
Bulgaria
Croatia
Latvia
Lithuania
Poland
Romania
Oceania Australia
New Zealand
Northern Canada
America
United States
Eastern Korea
Asia
Japan
-40 0 40 80
Note: Total government = central government + social security + state government + local government. Source: OECD (2015).
state government 2001 local government 2001 change local+state 2001 > 2013
293
public administration
Figure 7.19 Relationship between good governance and level of decentralisation (=share of
local and state expenditure in total government expenditure), 2013
12
good governance
FI
NZ NO SE DK
CH
NL
10 CA
AU
IE GB AT DE
JP
8
BE US
FR
EE
6 PT
SI CZ PL ES
KR
SK
4
HU IT
GR
2
0
0 10 20 30 40 50 60 70
decentralisation
294
public sector achievement in 36 countries
295
public administration
Figure 7.20 Relationship between business-friendliness and share of ICT expenditure, 2011
90
business friendly
87.5
NZ
85
KR
82.5 US
GB FI
80 DE
EE CA
CH
AT AU
77.5
PT
NL
75
FR
ES
72.5 SI
BE
70
IT
67.5
65
0.25 0.5 0.75 1 1.25 1.5 1.75 2 2.25
296
public sector achievement in 36 countries
Figure 7.21 Relationship between business-friendliness of public administrations, 2015, and postbureaucracy, 2010
85 DK
business friendly
82.5
FI GB
SE
80
DE
EE
AT
77.5
LV
PT
LT
75
FR NL
PL
72.5 ES
SK
BG SI
CZ
BE
70
RO
HU
IE
LU IT
67.5
GR CY
65
62.5 MT
60
0 10 20 30 40 50 60 70 80 90
post-bureacracy
Source: World Bank (2013).
(even though there are a few countries such as Germany that do not fit the
general pattern). If we remove both outliers from the dataset, the correla-
tion rises to 0.75, which is quite strong.
Do citizens have confidence in the civil service of their own country and
in their legal system? These confidence questions are included in the
European Values Study and European Social Survey. Some information on
297
public administration
Figure 7.22 ‘A great deal’ or ‘quite a lot’ of confidence in the civil service (%)
and trust in the legal system (score between 0-10)
8 DK
trust in the legal system
NO
FI
7
CH
SE
NL
6
DE GB
IE
BE
5
HU FR
IT EE
CY
CZ LT
4
ES
PL SK
PT
3 SI
BG
2
15 25 35 45 55 65 75
confidence in the civil service
R-squared=0.25 (adjusted: 0.21)
Note: No information on trust in the legal system is available for Austria, Luxembourg, Greece,
Malta, Romania, Latvia, Croatia and non-European countries.Source: European Values Study
(confidence in civil service, 2008), European Social Survey (trust in legal system, 2012).
confidence in the civil service can be drawn from the World Values Survey
(wave 6, 2010-2014).
The Swiss and people in the Northern European countries have most con-
fidence in their civil service, while in general citizens of Central European
countries have the lowest confidence levels as far as their civil service is
concerned. However, we also find remarkable differences within geograph-
ical clusters, for example between Germany and France or between Estonia
and Bulgaria. There is a fairly strong relationship between confidence in
the civil service and trust in the legal system. In the Slovak Republic confi-
dence is average but trust very low, but in most other countries higher trust
in the legal system correlates with higher confidence in the civil service.
Compared with most Northern and Western European countries, confi-
dence in the civil service is rather low in non-European countries: barely
40% in Australia, New Zealand and the us and barely 30% in Japan (World
Values Survey 2010-2014).
298
public sector achievement in 36 countries
Figure 7.23 Good governance and (‘a great deal’ or ‘quite a lot’ of) trust in the
civil service
80
trust in civil service
CH
70 LU
DK
FR IE
60
LV BE FI
SI CY MT
NO
SK
SE
50
PT
ES GB
HU EE AT NL
40
IT LT
DE
RO CZ
30 HR
PL
GR
20
15
BG
10
0 2 4 6 8 10 12
good governance
R-squared=0.47 (adjusted: 0.45)
As can be seen in Figure 7.23, civil services that perform better, are gener-
ally also more trusted by their citizens. The correlation is even quite high
(0.69). Therefore, contrary to Kettl’s (2015, p. 8) conclusion, good public
governance does appear to improve or at least correlate with higher public
trust in government. And of course, when a population trusts its civil
service, it makes it easier for the civil service to improve the quality of
government.
299
public administration
Table 7.6 Summary of results: relationship between outcome and system characteristics (Pearson’s r)
Notes: Bold = significant (5%), italic = significant (10%). Source: See relevant figures.
What can we conclude from this table? First, some structural character-
istics seem to matter more than others. For example, the size of (central)
government (share of expenditure) is not related to our four outcome
measures. Four structural characteristics are however significantly and
positively related to all four outcome measures: share of ict expenditure, pro-
fessionalism, level of decentralisation and freedom of press. ‘Professionalism’ and
‘freedom of press’, especially, appear to be very important characteristics.
They are not only the most strongly correlated with our outcome measures,
but it may be assumed that the direction of any causal link is also more
evident than in the case of ict expenditure: a professional, independent
administration based on meritocracy rather than political appointments
300
public sector achievement in 36 countries
Figure 7.24 Relationship between good governance and a scale [0,1] representing a combination of professionalism
of public administration, freedom of the press and gdp per capita, 2013
12
good governance
FI NZ NO
DK
SE
10 NL CH
AU CA
AT
DE IE
JP GB BE
8
US
MT FR
6 PT EE
CY
SI
PL ES CZ
KR LT
HU LV
4
SK
HR
IT
2
GR
RO
BG
0
0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9
combi GDP + professionalism + freedom of press
Source: World Bank (good governance); OECD (GDP); Dahlström et al. (professionalism); Reporters Without Borders (freedom of the press).
and favourable conditions for a free press increase the quality of public
administration. Another important structural characteristic is gdp per
capita, which is significantly and positively related to three of our four out-
come measures. Of course, cause and effect will very likely be mingled as
far as this structural characteristic is concerned. A high gdp per capita ena-
bles a country to build its state capacity (Fukuyama 2014) and, for example,
invest in ict, which improves public administration. On the other hand,
a well-functioning public administration is an important condition for
economic growth. A fifth important structural characteristic is the efficien-
cy of the tax administration. An efficient tax administration is probably an
overall characteristic of good governance, because only countries with a
certain minimum state capability are able to efficiently extract taxes from
their populations. Finally, decentralisation is significantly and positively
correlated with three of our four outcome measures. Even though, as we
have mentioned, there does not seem to be a general consensus in the
literature as to whether centralisation or decentralisation is beneficial, our
data do seem to indicate that decentralisation improves the performance
of a public administration.
301
public administration
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