Collier classifies states under statistically-based buckets as he is workingfrom an economic point of view seeking to isolate key factors using statisticalregressions, to make development more impactful. Collier says in his muchlauded and discussed book,
The Bottom Billion
“For want of a better term I will call those low-income countries that are below the cutoff for governance and economic policies "failing states." This is thesort of popular and emotive term that I do not usually like to use, but in this caseI think it has some rationale. Such states are failing in two senses. Most directly,they are failing their citizens. Populations in most of the low-income world livein countries that are growing rapidly, whereas these countries are stagnating.”
Getting the definition right is nevertheless tricky. Not all low-incomestates that fall below our cutoff have been failing states. For a number of countries, the rating crashed and then rapidly rebounded as policies changedrelatively rapidly. Such temporary crashes are not of interest to us. It is surely much easier to restore a country to reasonable policies if it has only justabandoned them than if it has been stuck with bad policies for a long time.Indeed, the temporary crashes we observe in the data may sometimes be spuriousassessments that are subsequently reversed. We therefore only count the country as a failing state if the rating has stayed low for a continuous period of four years.These criteria give us lists of states that can be classified as failing, year by year. To show you what they mean in practice, recent failing states include Angola, the Central African Republic, Haiti, Liberia, Sudan, the Solomon Islands,Somalia, and Zimbabwe. It would surely be difficult to argue with any of theseassessments. The Democratic Republic of the Congo hovers around the borderline. If this is the borderline, you know that the cutoff is low. More thanthree-quarters of the population of the bottom billion live in countries that haveat some time been failing states by this definition.Collier sees his classification as being extremely generous and notinclusive of countries not belonging to the infamous category of failed states.Collier also discusses in
The Bottom Billion
that there are significant aid andfunding problems with taking "failed state" status lightly; if a country is labeled asa failed state in the midst of a recovery, it will not attract outside foreign directinvestment or foreign aid donor money until after another year of results, so acountry may get caught in the lag of budgets and rankings.
The Fund for Peace and the Failed States Index, Published in ForeignPolicy Magazine
The Failed State Index ranks countries based on twelve indicators, brokenup into the three categories of social, economic, and political:
Collier, Paul, The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done AboutIt. Oxford University Press, USA, 27 Apr. 07. p.68.