The relationship between democracy and performance - Essay Example

?What is the relationship between democracy and performance? Introduction Democracy has become the dominant governance system in the world. Whether or not it is the more effective system is still a matter up for debate. Undoubtedly however, there seems to be a relationship between democracy and performance. To some governments, democracy helps improve performance, allowing for the free exchange of commerce and greater transparency in the administrative processes. However, for others, there is a strong belief that other forms of government would be better options in securing improved performance. This paper shall now discuss the relationship between relationship and performance using concepts relating to economic performance, political stability, and other elements of governance. Body A realistic assessment of the workings of democracy indicates that the impact of civil liberties in a country is significant in relation to the performance of a government and its investment activities (Pritchett and Kaufmann, 1998). Such finding supports the idea that the extent to which citizen are able to express their opinions in the public sphere has a crucial impact on how accountability would apply in relation to government and its efficacy. To some analysts, there is no clear association between the elements of electoral governance or democracy and the performance of government activities (Isham, 1996). However, majority of those within the western democracies associate democracy with better government performance. The link between the government and economic development as well as the management of poverty is very complicated. Three issues are important to politicians: what the governments should do; how government decisions must be made; and how well the governments would be able to implement their options (Pritchett and Kaufmann, 1998). In various scenarios, it is possible that the issue of ‘how well’ is more significant than the question of what, especially as how well a government actually allocates its resources may actually be more significant than how much is actually spent by the government. This discussion would evaluate new discussions which would correlate how government activities are carried out and how well they actually function (Pritchett and Kaufmann, 1998). Indicators for success in projects include the economic rate of return which is based on the accomplishment of the project, and the rating on whether the project was able to fulfil its project goals. Data on success of bank-supported activities are considered determinants of borrower countries and their efficacy (Isham, 1996). This is because the projects supported by the World Bank are carried out by the borrowing country and its government which then implements the project. As such, there may sometimes be comparisons on ex post success in relation to how well governments undertake projects they opt for, rather than evaluating what projects they actually select. Data on bank-supported projects also provide a specific classification on project success based on comparative elements for different countries (Pritchett and Kaufmann, 1998). Most countries do not often assess their own projects, and most of them do not allow their own assessments to be evaluated based on the determinations made by other countries. Although there may be inaccuracy in terms of project evaluation, the evaluations gained are generally reliable elements in indicating success or failure. As the World Bank is a global institution with specific rules and consistent policies which all apply to borrowers, it is not likely for differences between countries in relation to Bank-supported activities to be primarily the result of inconsistent decisions from the WB (Pritchett and Kaufmann, 1998). The measures of democracy in this essay focused on different cross-national determinants. One of these determinants is based on rankings made by Freedom House where the firm ranks countries yearly using a checklist which includes the lack of media censorship, open discussions in public, freedom of assembly, and personal social liberties (e.g. right to travel) (Kaufmann and Wang, 1995). Charles Humana also ranked states based on how well they fulfilled the rights indicated in the International Covenant on Civil and Political Rights. These rights included the right to peaceful assembly, right to express opinions in public, and the right to participate in public activities. In 1989 in China, the Tiananmen Square protests, many youth protesters expressed their opinions against the Chinese government, including its corrupt practices and the limited career prospects made available to them. These protests present a culmination of society’s struggles against an autocratic government. These protests also indicate how the lack of democratic rule impacted negatively on the society in general. In 1998, Pritchett and Kaufmann established that there is a strong link between the assessments on the extent of civil liberties and the performance of the country in the WB-funded projects. The mean economic rate of return based on the assessment by Pritchett and Kaufmann (1998) was pegged at 16%. These results indicate that where a country is to adjust from being in the worst civil liberty to being the best, the mean rate of return on its activities would increase by about 8 to 20% points. This would imply the increase in the return of the projects by about 50%. The same results are observed in relation to the general indicator of project success, leading to better indications of project success in countries where civil liberties have improved. The impact of democracy manifests in relation to social and economic factors. The economic rate of return is computed for only the factors where the computation of financial profits is possible (Pritchett and Kaufmann, 1998). These would be the hard areas where governance would not be as relevant in relation to the social sectors. Assessments indicate a specific conjunction or link with previous studies, which have indicated how poor macroeconomic policies impact on returns, as well as on project performance in the social sectors such as education and health (Kaufmann and Wang, 1995). In other words where there is poor performance in projects, in both soft and hard sectors, poor governance is actually also observed. The link between the success of the project and democracy is not only seen in the relationship between two elements, but is also observed when the elements of macroeconomic policy, country economics, outside shocks and challenges are considered within the economic model and when accommodations are made in terms of sectoral and regional gaps in returns (Isham, et.al., 1995). Other assessments have also indicated favourable relations between the project success and other wider indicators of administrative quality including the index of credibility used by the World Bank (World Development Report) in order to assess institutional quality. The determinants of democracy and human rights are preferred especially as it was established that rankings for the civil liberties had more clout in explaining the outcomes of government projects when compared to other indicators and especially as civil liberties would likely impact accurately by affecting different measures of government actions including credibility and corruption (World Bank, 1997). In terms of assessing the impact of civil liberties in relation to the performance of WB-supported projects, data on the impact of civil liberties are also measured. To protect against specifics in any measure, different indicators are often applied. The Freedom House rankings indicate political freedoms using different elements (Pritchett and Kaufmann, 1998). Asena also applies an index for democracy, ranking countries from 1 to 3 with 1 being the most democratic. None of these measures of democracy impacted much in terms of project performance. In fact, the considerations on whether democracy was the more significant determinant in project performance were assessed in order to secure better standards (Pritchett and Kaufmann, 1998). While the two elements are very much related to each other, the assessments indicate the projected effect of civil liberties on project success does not just stem from the fact that democracies include a wide range of civil rights and liberties. Civil liberties seem to represent a significant force for managing performance even for other less democratic countries. The Rwanda Genocide also represents a time where the lack of democratic rule in a country and the lack of protection for the minority led to poor performance by the government, including a poor response to the needs of the people in general. Under similar conditions, the Marcos martial law regime which placed President Marcos in the Philippines into 20 years of rule also pushed the people to take to the streets and express their desire for freedom and democracy. Where once the country was one of the promising economies in Asia, by the end of Marcos’ rule, it was one of the poorest countries in the region. Hitler’s dominance during the Second World War also represents how the lack of democracy can impact on governmental performance. During his years in power, Europe and North America was practically at his mercy. Economic growth was held at bay until such time when his rule ended and democratic rule was gradually restored in the affected regions. It is deemed that the most appropriate means of understanding evidence on the link between democracy and government performance is to assess it based on discussions on the micro-elements of government functions (Vigoda, 2002). There is no perfect government. There are various instances of government blunders, from the most oppressive and controlling to the most corrupt and indifferent regimes. In focusing on government failings, it is a helpful cure to a vague conceptualization of governments, highlighting on government failings is no a productive process, especially as simply not having government at all is not possible or favourable, and strong economic development calls for specific significant functions to be implemented by governments (Vigoda, 2002). The main issue is not the actual government size, but mostly what would be considered social, political and institutional functions which support initiatives for strong government functioning. The question does not have specific answer, however present study results relating to democracy are related to results seen on studies which focus on the voice of citizens as a primary tool or resource. A centralized approach to governance has often not been able to indicate the desired results (Feld and Savioz, 1997). The studies assessing the effect of the citizen’s voice is based on different conditions. Combined empirical data has indicated that the favourable results from government projects are specifically evaluated based on the extent of citizen participation on the design and operations processes (Gerring, et.al., 2005). Studies on the performance of irrigation systems in two Asian countries also indicated that the extent of local participation over the irrigation administrators was the main factor in determining the performance of irrigation system performance (Wade, 1990). In evaluating the general efficacy of the Italian government, it was established that social relations among citizens are a strong factor in evaluating government performance. Judith Tendler’s (2000) evaluation of the major developments in health observed in Ceara, a Brazilian state indicates that governments can easily shift from limited to major success by focusing on the synergy of the leaders, the motivates workers, and the involved locals. There is also evidence to support the fact that countries with stronger democratic processes in place have performed better in ensuring education for girls and decreasing infant mortality (World Bank, 1991). More reports also indicate that improved democratic processes in countries often decrease corrupt practices. The association between democracy and the expression of citizens’ opinions and voice indicates sometimes a confusing finding. If the data would be assessed in terms of connections between various indicators of socio-political gaps and project results, there are countries with better economic return rates with more cases of riots and demonstrations when compared to countries with lower rates of return (Tendler, 2000). As manifestations of social unrest of this kind are often considered to have an unfavourable impact on investments and performance, this was confusing. This study indicated however that states with limited freedoms did not have much expressions or manifestations of social unrest, while those with greater freedoms had more manifestations of social unrest. There is an indication that states where all styles of expressing disfavour are controlled and repressed often do not perform well on investment projects as compared to other countries where social issues and expressions of grievances are often allowed (Pritchett and Kaufmann, 1998). In the same vein, specifically identified political democracy is unnecessary or is even sufficient to support the full manifestation of people’s grievances. Some of the most ineffective and most corrupt governments are also democratic countries and some of the well-functioning countries are actually not fully democratic (Pritchett and Kaufmann, 1998). The question of who carries out the activities and decisions in the daily operations of the country cannot be set simply by carrying out elections. Although the standards of the WB are often used to evaluate the projects they fund, the fact that these activities were financed by donors does trigger issues on the impact of these projects on donors (Gerring, et.al., 2005). The initial implication is that the World Bank has not been able to protect its projects from the conditions of the local government or country benefiting from the project (Marsh, et.al., 1999). Earlier studies on the associations between the results seen in World Bank funded projects and the macroeconomic environment has had a role in shifting dominant views wherein projects and policies can be assessed separately and the activities can be separated from national policies (Wade, 1992; Owens and Wade, 1998). The association between a country’s macroeconomic conditions and the impact of aid in improving economic growth rates has been confirmed (Dollar and Levin, 2000). In this article, a similar evaluation and conclusion can be indicated to determine project success and indicate government efficacy. There are strong arguments in terms of government agencies setting policies which remove them from local policies. The current study does not indicate otherwise. Under these conditions, two elements must be kept in mind. First, that the most debated and the barely political elements of democracy were not seen to impact on project performance (Pritchett and Kaufmann, 1998). Secondly, majority of the difficult issues relating to sovereignty, conditionality and the kinds of donor specificity applicable have been based on issues of what the government must do. On the other hand, supporters may focus on the how well aspect of government functioning. The efficient functions of the government projects which development groups financial support is very much crucial to the mission of the agencies, and therefore is an expected concern. To the point where project accomplishment is carried out in terms of the expression of grievances and opinions as well as their participation in governance are supported becomes a well-founded aspect for discussion in the management of projects to be supported (Pritchett and Kaufmann, 1998). The dominance of President Saddam Hussein in Iraq also represents a time where corruption and autocratic rule by the government drove the people deeper into poverty. Under these conditions, the minorities suffered significantly and the economy struggled to meet the needs of the people. The equal distribution of physical capital in society is now generally considered a crucial element of effective and sustained economic growth (Besley and Burgess, 2000). To the extent to which democracy is successful in re-allocating wealth via taxation, social policies, land redistribution, or through markets in civil society to the groups often excluded, it seems to be reasonable to see that as these regimes stay longer, its impact would be greater in terms of social equality and development (Lenski, 1966). The short-term impact of democracy is set as theories indicate that its sustained existence must have positive effects in redistributing wealth and income in society (Gradstein and Milanovic, 2000). Human capital also has an extensive role in society. The endogenous theory believes that it has a major impact on growth and development (Xavier and Martin, 2002). It also seems acceptable to consider democracy as a significant institutional element in the evaluation of human capital, as assessed by reduced fertility rates and growth in education and life expectancy (Gerring, et.al., 2005). The wealthy members of society in a democracy have a major motivation to avoid poverty and therefore consider improvements in the quality of life of the poor. These motivations are not seen in the authoritarian regimes. Different discussions have manifested how democratic rule supports improvements in the human capital resources (Baum and Lake, 2003). Due to the prolonged nature of human capital, the longer democracy is in effect, the greater its impact on human capital (Gerring, et.al., 2005). It is also important to note that social capital also impacts on the economic productivity of society. For instance, Guiso and colleagues present their discussion on social capital supporting financial development (Guiso, et.al., 2004). Where democracy supports the growth of social capital, it would be natural to expect that long-term democracy would also have significant effects on social capital (Putnam, 2002). These discussions indicate how democracy’s impact on growth would likely be more obvious with time as the social capital grows, develops, and matures. Conclusion As a specific point on a highly debatable area of discussion, it must not be argued that democracy and civil liberties are significant only as they are relevant tools in ensuring government efficiency, especially as the underlying reasons for efficiency are much deeper. Still, democracy and its related civil liberties, alongside other manifestations of democracy and expressions of opinion do seem to have a major value in ensuring positive economic performance and for managing the tools for delivering government services of all kinds, including social services, schools, roads, and health services. These elements have to be conceptualized and understood in different ways, mostly based on different sectors in terms of developmental activities. Democracy and performance are very much related to each other, especially as democracy allows for more economic and political leeway which can help support growth and ensure the contribution of the people in fulfilling the needs of the greater population. With greater transparency, come greater control and eventually long-term success and sustainability. Political conflicts: 1. Second World War 2. Rwanda Genocide 3. Marcos regime followed by People’s Power Revolution in the Philippines 4. Tiananmen Square massacre 5. Iraqi War References Baum, M. & Lake, D., 2003. The Political Economy of Growth: Democracy and Human Capital. American Journal of Political Science 47. Besley, T. & Burgess, R., 2000. Land Reform, Poverty Reduction and Growth: Evidence from India. Quarterly Journal of Economics 115. Dollar, D., & Levin, V., 2006. 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