This action might not be possible to undo. Are you sure you want to continue?
006 July 2008
Social Institutions and Human Development
For almost two decades, development theorists and practitioners have drawn attention to the importance of social institutions or ‘social capital’ as a means of enhancing human capabilities and freedoms. However, empirical testing has been inhibited by the absence of cross-country measures. Drawing on a set of 25 data sources, this paper attempts to provide the first worldwide indices of social institutions, understood as the informal norms that pattern human interaction. Six indices are presented corresponding to the following dimensions: (1) inclusion of minorities, (2) gender equity, (3) intergroup cohesion, (4) clubs and associations, (5) interpersonal safety and trust and (6) civic activism. In accordance with a growing literature on the links from institutions to development outcomes, this article provides empirical evidence of the relationship between social institutions, such as social inclusion and norms of non-discrimination, and human development outcomes such as equal access to health, fair government, and a better income.
SOCIAL DEVELOPMENT WORKING PAPERS
Paper No. 006 July 2008
Social Institutions and Human Development
This Working Papers Series disseminates the findings of work in progress to encourage discussion and exchange of ideas social development issues. The papers carry the names of the authors and should be cited accordingly. The series is edited by the Community Driven Development team in the Social Development Department of the Sustainable Development Network of the World Bank. This paper has not undergone the review accorded to official World Bank publications. The findings, interpretations and conclusions herein are those of the author(s) and do not necessarily reflect the views of the International Bank for Reconstruction and Development/ World Bank and its affiliated organizations, or its Executive Directors, or the governments they represent. To request copies of the paper or for more information on the series, please contact the Social Development Department Social Development The World Bank 1818 H Street, NW Washington, DC 20433 Fax: 202-522-3247 E-mail: email@example.com
Printed on Recycled Paper
Table of Contents
Table of Contents ........................................................................................................................................................ i Foreword..................................................................................................................................................................... ii I. Forms of Social Institution .................................................................................................................................4 Data Sources ........................................................................................................................................................7 Methodology .....................................................................................................................................................12 II. Results................................................................................................................................................................13 Social Institutions and Economic Growth .....................................................................................................16 III. Conclusion .......................................................................................................................................................22 References ..................................................................................................................................................................23 Appendices ................................................................................................................................................................26 Sources Used .........................................................................................................................................................28
In recent decades, there has been a steady current of country-specific studies examining the effects of social institutions - the informal norms that pattern human interaction - upon economic and political outcomes. However, despite the positive results found in successive regional and local studies, there have been relatively few attempts to test the impact of social institutions at the international, crosscountry comparative level. This paper draws upon the initial results of a method for combining indicators from multiple sources, in order to generate better aggregate measures of social institutions, and maximize efficient use of data in country-comparative testing. By generating composite indices it is possible to estimate scores for a much wider number of countries than otherwise possible, and the indices used in this paper provide social institutional estimates for 192 societies, a far greater number than previously the case. The utility of the new measures is then demonstrated by conducting several empirical tests which highlight the links from social attributes, such as a healthy civil society or cohesive relations between ethnic groups, and development outcomes, including good governance and economic growth.
In section I of this paper, the empirical basis of the new measures is outlined. Section II discusses the results with reference to emergent issues in the institutional literature, including the deep determinants of good governance and economic growth. Finally, section III concludes with a look toward areas of research that in future can be addressed using social institutional data, such as that presented here.
Measuring Social Institutions
In recent decades, there has been a steady current of country-specific studies examining the effects of social institutions - the informal norms that pattern human interaction - upon economic and political outcomes. Among the myriad issues that have been addressed within the ‘social capital’ literature, notable examples include the finding by political scientists that countries and regions with greater associational life, trust and inter-group cohesion tend to have better public service delivery, financial accountability, and adherence to democratic norms (Putnam et al. 1993, Knack 2002, Coffe and Geys 2005); the finding by psychologists that engagement in community activities has a significant association with measures of health and educational attainment (Berkman and Syme 1979, Coleman 1988, Helliwell 2003); and the finding by economists of a robust association between social institutions and economic wellbeing in the form of both household income and aggregate economic growth (Knack and Keefer 1997, Zak and Knack 2001, Narayan and Pritchett 1999, Grootaert 2001, Tabellini 2005, Knowles and Weatherston 2007).
However, despite the positive results found in successive regional and local studies, there have been relatively few attempts to test the impact of social institutions at the international, crosscountry comparative level. Few reliable, globally representative data sources exist that would serve as a basis for comparing social norms and practices, while survey data for social trust and community engagement are often fragmented across disparate regional samples. Commonly used proxy and instrumental variables, such as ethnic fractionalization or the proportion belonging to a hierarchical religious tradition, may be only weakly reliable or valid as measures of social institutions, whereas direct behavioral items taken from representative national surveys, such as social trust or civic norms, often cover only a limited sample of countries.
In order to advance systematic cross-country investigation of the effects of social institutions, this article presents the initial results of a method for combining indicators from multiple sources, in order to generate better aggregate measures of social institutions, and maximize efficient use of data in country-comparative testing. By generating composite indices it is possible to estimate scores for a much wider number of countries than otherwise possible, and minimize the level of error in the estimates as the addition of successive indicators reduces random variation. The indices presented in this paper provide social institutional estimates for 192 societies, a far greater
number than previously the case, and are reported together with margins of error, reporting the level of confidence in a particular country score.
I. FORMS OF SOCIAL INSTITUTION
In order to organize our data collection, it has been necessary to adopt a working definition of social institutions. Following North (1990), these are defined as the informal norms and conventions that pattern social behavior, ‘the rules of the game in a society [or] the humanly devised constraints that shape human interaction’. Whereas formal institutions are rules enforced by third-party mechanisms, such as a police corps, judiciary, or constitutional council, social institutions generally rely upon tacit norms and expectations. Examples of informal institutions include the practice of signing petitions to protest a policy, joining a neighborhood watch group, or willingness to do business with a member of a different ethnic group. These can be distinguished from formal institutions, examples of which include the requirement to put constitutional amendments to referendum, the power of judicial review, or the existence of legal sanctions against infringement of intellectual property rights.
Our definition of informal institutions clearly encompasses a wide range of human customs and practices, and therefore from among the universe of total possible institutions, we introduce a second term, social development, to highlight those which, theoretically and empirically, are conducive to welfare gains by reducing transaction costs, facilitating collective action, and improving allocative efficiency1. Subsets of the social development indicators are grouped into six dimensions of social development.
First, inclusion of minorities measures levels of discrimination against vulnerable groups such as indigenous peoples, migrants, refugees, or lower caste groups. Such discrimination is a significant ‘hidden barrier’ to equality of opportunity in society and in economic life, both through its direct effects on access to jobs and services, and its indirect effects via unequal access
Transaction costs are the costs incurred in making economic exchanges, and can be reduced through the social institutions of cooperation and trust between diverse members of society. Collective action is the pursuit of a goal by more than one person, and is enhanced by social institutions of community participation and civic engagement with the political authorities. Allocative efficiency is the condition under which resources are allocated such as to maximize the net benefit attained through their use, and is enhanced by the social institutions of non-discrimination in the access to social and economic opportunities, without prejudice due to religion, ethnicity, caste, or gender. While the term ‘social capital’ understood as the norms and networks that enable collective action (Woolcock and Narayan 2000) - is frequently used to refer to the first and second of these areas, in this paper we apply the term ‘social institution’ as a means of focusing on specific norms and rules of behavior (rather than a configuration of beneficial attributes), and ‘social development’ as an openly normative term which refers to the aggregate of desirable such institutions.
to the resources that enable future economic and social advancement. For example, theories seeking to explain the significant association between certain measures of ethnic fractionalization and the universality of public services (e.g. Alesina et al. 1999, 2003, La Porta et al. 1997) have often cited group-based discrimination as the cause, with clientelism the intermediary institution. Where the electoral incentive for universal public goods provision is low, as in many ethnically diverse societies, politicians mobilize support through selective incentives such as public sector jobs or local infrastructure at targeted groups (Robinson and Verdier 2002). Evidence suggests that the relationships between identity groups in a society have important secondary consequences for the level of allocative efficiency in an economy, as norms of arbitrary discrimination may lead to sub-optimal resource allocation. Easterly and Levine (1997), for example, find per capita GDP growth inversely related to ethnic fractionalization in a large sample of countries; these findings are also reported by Alesina et al. (2003).
Second, gender equity specifically estimates the level of discrimination against women. The treatment of women is measured in a separate index, first, because the treatment of women depends upon a different set of social institutions to those that pattern social stratification between identity groups; and second, because of the special role women play within development as mothers and as heads of household. Empirical evidence shows that increases in female education improve human development outcomes such as child survival, health and schooling; the impacts on these outcomes are larger for a given increase in women’s education than for an equal increase in men’s education (World Bank 2001, Schultz 2002, Thomas et al. 1991, King and Hill, 1993). In addition to the role of gender equity in poverty reduction, gender empowerment matters for economic growth, as such norms are allocatively suboptimal, and empirical research also suggests an independent effect of gender equity upon individual and aggregate economic outcomes (Schultz, 2002, Esteve-Volart, 2004, Morrison et al. 2007).
Third, civic activism measures the extent to which social practices encourage more active and critical engagement with political authorities. Whereas clubs and associations is focused on the institutions which facilitate collective action for the purpose of providing local public goods, civic activism focuses on the institutions that facilitate the emergence of what Norris (1999) calls ‘critical citizens’, that is political subjects able and willing to articulate and represent their interests before government. Such practices include but are not limited to engagement in debate and reflection over public policy in the media, and the practice of actively representing citizen interests through contacting public officials and protesting unpopular policies. In a range of empirical tests, Paxton (2002) finds that participative governance is facilitated not by membership
of associations in general, but only of those that are ‘nonlocal, internally democratic, and have links to global democratic norms’ (2002: 271), while Inglehart and Welzel (2005) identify civic affirmativeness as the most important social precondition for shifts to more accountable governance, using an index of ‘self-expression’ values which includes signing of petitions and willingness to attend of demonstrations. The implication is that civil society matters for accountable governance, not through enabling collective action, but rather by fostering norms of active and critical citizenship.
Fourth, clubs and associations uses data on levels of engagement in local voluntary associations, time spent socializing in community groups, and membership of developmental organizations, to gain a measure of the range and the strength of ‘strong’ social ties, that is, ties with persons who are known to the individual. The strength of such an associative life is central to what Woolcock and Narayan (2000) term the ‘communitarian’ understanding of social capital, according to which central elements are ‘such local organizations as clubs, associations, and civic groups’. This approach to social capital is most widely associated with the works of Robert Putnam (2000) and Amitai Etzioni (1997), whose studies have examined the health, and perhaps decline, in associative life in western democracies. In terms of the collective action that they facilitate, across the world community networks are essential for welfare and service delivery, and in the context of economic development, matter hugely for the theory and practice of microfinance, as well as the disbursement of local level funds, such as the Community Driven Development project of the World Bank (Guggenheim 2006).
Fifth, inter-group cohesion specifically measures the extent of routinized conflict between ethnic, religious, or other social identity groups. The persistence of acts of inter-group violence, including reprisals, terrorism, and inter-group violence has the effect of increasing transaction costs, but unlike generalized social trust, it is specifically directed at defined identity groups. Empirical research has shown the phenomenon of inter-group cohesion to have specific links to the themes of public service delivery and political stability. In addition, conflict is among the principle causes of low economic growth among the very least-developed countries (Collier 1999).
Sixth, interpersonal safety and trust measures the level of generalized trust and confidence between individuals, specifically with regard to the likelihood of criminal violence and other forms of trustworthiness or trust violation. Generalized social trust is one of the most widespread ways in which ‘social capital’ has been defined and studied (Fukuyama 1995, Arrow 1974, Knack
and Keefer 1997), and among its benefits is a substantial reduction in transaction costs. As Fukuyama (1995) argues, where ‘people who have to work together in an enterprise trust one another because they are all operating according to a common set of ethical norms, doing business costs less’. Empirical studies have also shown generalized social trust to be a predictor of future rates of economic growth, as would be expected if its effect is to facilitate positive-sum exchange (Knack and Keefer 1997).
To create estimates of the above six types of social institutions, the social development indices have compiled over 200 measures from 25 sources, including international organizations, comparative survey projects, rating agencies, and academic assessments2. The sources produce indicators for a wide range of concepts relating to social institutions, using different techniques, and covering different groups of countries. In general, however, the data sources are divided into two categories, reflecting the different methods via which the measures were generated.
Firstly indicators are divided between actionable indicators, which are based on direct measurement of social institutions and their outcomes, and perception-based indicators, based on assessments by public opinion surveys, private agencies and non-governmental organizations, of the nature of social institutions in that country (see Table 1.0). Actionable indicators are generally preferable to perception-based indicators, in that they are more responsive to changes in underlying social conditions, and cannot be influenced by changes in perception independent of substantive social change. However, because some norms and practices are difficult to measure directly, perceptions measures are sometimes needed to supplement these data. Perceptions are also useful to study in their own right, as they may constitute causal factors that maintain or erode certain social institutions, for example those of discrimination or social trust.
A summary is provided in Appendix I.
Table 1. Types of Social Institutional Indicators
Actionable Proxy variables Behavioral
Perception-based Public opinion Expert assessment
Membership of international NGOs, per capita access to radios
"Here is a list of actions that people sometimes take as citizens. For each of these, please tell me whether you, personally, have done any of these things during the past year.” - Attended a demonstration or protest march
“How much confidence do you have in civil society organizations in your country?”
Civicus ratings on effectiveness of civil society organizations
Clubs and Associations
"Now I am going to read out a list of groups that people join or attend. For each one, could you tell me whether you are an active member, an inactive member, or not a member?" Development associations
“Would you say that, in your neighbourhood, people generally help one another?”
Number of newspaper-reported ethnic riots
“How much of a problem is ethnic violence in society?”
International Country Risk Guide rating on levels of ethnic or religious tensions
Interpersonal Safety and Trust
Deaths from homicide
“Over the past five years has anyone taken something from you, by using force, or threatening you?” "On this list are various groups of people. Could you please sort out any that you would not have as neighbors?" - those of another ethnicity, those of another religion
“Generally speaking, would you say that most people can be trusted or that your can't be too careful in dealing with people?” “Is your ethnic group ever treated unfairly: i) when looking for a job”
Economist Intelligence Unit rating on ‘level of social mistrust’
Inclusion of Minorities
Ratio of minority groups in professional occupations relative to population
Minorities at Risk rating on level of economic discrimination
Ratio of female to male mortality rates, ratio of female to male school enrolment rates
Proportion of wives reporting having suffered an act of domestic violence in the past year
Proportion of women who feel that “women have the chance to earn the same salary as men in their country”
Cingranelli-Richard rating on women’s social rights
We can then subdivide within each category, depending on the means via which the data are generated. Actionable indicators are either proxy variables based upon the measurable outcome of social institutions, or information on reported social behavior taken from nationally representative surveys. Proxy variables in our dataset are those typically used in studies of social capital, such as per capita newspaper circulation, the density of international non-governmental organizations, or the reported number of ethnic or other violent street riots. The use of proxy variables such as newspaper circulation depend upon reasonable inferences regarding the causes and consequences of social action, such as the assumption that greater newspaper readership reflects greater citizen propensity to engage in civic activism, or that violent riots reflect the breakdown of cohesion among social groups. The validity of these inferences is confirmed by the often high degree of correlation between each of these measures and other indicators of social institutional structure. Behavioral items taken from comparative, nationally representative survey projects include responses to questions such as the signing of petitions, domestic violence, or membership of voluntary associations. Key sources include the World Values Survey, founded in 1981, which currently provides comparative measures such as social trust, tolerance of minorities, and voluntary associational membership for almost 90 societies around the world, as well as regional survey projects, such as Latinobarometer, founded in 1996, Afrobarometer, founded in 1999, and Asian Barometer, founded in 2003, which cover a joint total of 49 societies.
Perceptions-based measures can likewise be divided into two categories, depending upon the nature of the underlying data source. The first form of perception-based data come from the nationally representative public opinion surveys just mentioned, and include responses to those questions which ask the respondent to give their opinion on some issue, such as their level of confidence citizens feel in their civil society organizations, the level of discrimination women or minorities feel they encounter in their daily lives, or the trust people have in their fellow citizens. While ‘softer’ than survey questions on actual behavior, these items allow researchers to tap into a range of additional issue areas where harder data may be lacking. The second category consists
in numerical ratings produced from expert assessments, in which academics, non-governmental organizations, and private rating agencies assess the nature of social institutions across countries. Such assessments have become more widespread in recent years, as researchers have sought to make social institutions visible to quantitative analysis. The Minorities at Risk project, for example, was started in 1986 and has been updated over three successive waves, providing comparative measures of discrimination and exclusion of minority groups in 118 societies across the world. The International Country Risk Guide has since 1980 provided assessments of a range of social variables, in addition to purely political and economic factors, such as the level of ethnic or religious tensions. Meanwhile, since 2003 the Civicus civil society network has been developing a range of indices for the health of civil society. These efforts to code descriptive assessments of the quality or otherwise of social institutions into numerical form open up a further rich source of information for researchers wishing to comparatively assess the social environment of different countries.
Table 2 below summarizes the relative prevalence of each of these data categories in the database of social development indicators. Shown are the proportion of country-year data points in each category. Overall, actionable proxy variables account for half of the data used, with survey data on social actions and behavior forming an additional quarter. The remaining quarter of data points are split between perceptions-based indicators derived from public opinion surveys and expert assessments.
Table 2. Proportion of Data Points in Each of the Indices, by Type Actionable Perception-based
Civic Activism Clubs and Associations Intergroup Cohesion Safety and Trust Inclusion of Minorities Gender Equity
0.71 0.00 0.34 0.37 0.00 0.75
0.24 0.79 0.13 0.12 0.21 0.07
0.00 0.21 0.02 0.21 0.09 0.04
0.05 0.00 0.51 0.22 0.70 0.15
Not all sources provide observations for every indicator in each country, but together, these data sources allow for comprehensive estimates of the nature of social behavior and norms of interaction across a broad range of societies Thus:
1) For the civic activism measure, a score for Bolivia in 2005 is estimated using 9 pieces of information from 4 different sources: the LSE Civil Society Yearbook figures for the number of International NGO secretariats based in that country (9) and connections to international NGOs (1216); Latinobarometer survey items for participation in petitions (48%), lawful demonstrations (45%), and the average number of days in the week that a respondent follows current affairs via television (4.78/7), newspapers (2.27/7), and radio (4.73/7); UNESCO data on the number of daily newspaper titles, per capita (2.13); and a Civicus Civil Society assessment rating the quality of civil institutions with regard to their structure, environment, values, and effectiveness (1.65/4). These data are aggregated by source and combined using the matching percentiles method, to generate a composite score of 0.538 for Bolivia. This score is roughly in the middle of the world distribution, and within Latin America and the Caribbean, falls roughly halfway between Peru (0.548) and Ecuador (0.510)3.
2) For the inclusion of minorities measure, a score for South Africa is estimated using 11 pieces of information: the Fund for Peace rating on the extent of uneven economic development based on group lines (8.5/10, 2005); the proportion of the population who say that their ethnic group is treated 'the same' as other groups (39%, 2004); the proportion of the population that say their ethnic group has the same political position as other groups (40%, 2004); the proportion who say that their ethnic group is 'never' treated unfairly (40%, 2004); relative income disparities and level of economic discrimination regarding Asians, Black Africans, "Coloreds", Europeans, Xhosa, and Zulus as estimated by Minorities at Risk (2003); the proportion of the population who trust those of another ethnic group 'not at all' or 'just somewhat' (57%, 2004), the proportion of the population who would refuse to have someone of a different race as a neighbor (20%, 2002); the proportion of the population who would refuse someone with AIDS as a neighbor (25%, 2002); the proportion refusing immigrants or foreign workers as neighbors (25%, 2002); and the proportion refusing homosexuals as neighbors (43%, 2002). These items are first aggregated by each of 4 sources - the Fund for Peace, Afrobarometer, Minorities at Risk, and the World Values Survey - and combined using the matching percentiles method, to generate a composite score for South Africa, of 0.31. This is substantially below other Anglophone countries such as the United
For further reference, the high and the low scores within Latin America and the Caribbean are held by the Bahamas (0.630), and Haiti (0.267), respectively.
States (0.51) or New Zealand (0.61), but slightly above the global median, and within a similar margin of error to countries such as Kenya, Latvia, and Malaysia.
The method used to combine the indicators is a latent variables approach, as adopted in the generation of the Worldwide Governance Indicators and Transparency International’s Corruptions Perceptions Index (Kaufmann, Kraay, and Zoido-Lobatόn 1999a, 2006; Lambsdorff 2006). The intuition behind this procedure is that each of a set of indicators represents some latent value of the underlying phenomenon in each society, but on differing scales, with differing country samples, and with varying degrees of measurement error. Assuming that errors are uncorrelated across sources, indicators can be combined to reduce the aggregate level of error, with the rankings of countries according to each indicator used to consecutively reassign scores across cases.
The method assumes that for each of the 6 dimensions of social development there is some latent value (Li) representing the objective level of that dimension in country i. Each of the available indicators yi represents, on a different functional transformation (f) and with varying degrees of measurement error εi, level Li such that:
(yi) = f (Li ) + εi
Because we are unable to estimate the functional form f, the aggregation methodology is nonparametric, with no assumptions regarding the linearity or otherwise of the distribution of the values in y. We merely assume that the relative position of countries on y reflects a better or worse underlying condition with respect to L. The ranks of successive indicators used in the index are then utilized in order to assign values to countries, based on the values assigned to the same sample of countries already in the measure. Thus if a new indicator is added to the index that has a sample of five countries, Botswana (6.8), Nigeria (5.5), Sudan (2.4), Burundi (3.1) and Tanzania (7.2), and the equivalent scores for these countries in the index thus far are 0.55, 0.40, 0.10, 0.11, and 0.35, then Tanzania will be assigned the maximum equivalent value of 0.55, Botswana the second value of 0.40, Nigeria, 0.35, Tanzania 0.32, Burundi 0.11 and Sudan 0.10.
The matching percentiles method used in this exercise is iterative, such that the indicators to be compiled are first sorted in order of their representativeness, S1, S2 … Sn for each of n different sources. As successive indicators are added, the standard deviation of the estimate is held constant among affected countries, to prevent their scores from tending toward the mean. The matching percentiles method has several advantages for creating a set of indices of this nature, in that first it overcomes the problem of sampling bias, whereby a new source only covers a limited and unrepresentative sample of countries, and second it allows us to keep adding successive waves of indicators, even with very small samples, that can be used to continually ‘refine’ the country scores simply by using information on relative rankings. Scores are estimated in four waves from 1990 to 2005, using the most timely data for all countries, this yields one or more social institutional scores for a total of 192 countries. The average number of indicators per country estimated ranged from 7.7 to 17.3 items, depending on the institutional cluster, and scores are rescaled from 0-1, whereby higher scores represent greater advancement on that dimension of social development.
Figure 1.0 shows the relationship between economic development, as measured by log per capita GDP at PPP, and the quality of social institutions, measured by each of the six social development clusters. It can be seen that for all of the clusters except for membership of clubs and associations, there is a positive relationship between national income and the quality of a country’s social institutions4. Countries with higher levels of gender equity, civic activism, intergroup cohesion, and interpersonal trust tend by and large to have to have higher national income per capita, and vice versa. Further trends over time, and by region, are shown in Figure 3.0.
Now let us examine the relationship between social institutions and measures of human development. Human development refers to the process by which people are granted the freedoms and capabilities to lead lives that they value, and thereby raise their level of wellbeing; its most commonly used proxy remains the Human Development Index (HDI), which is based on
The relationship between voluntary association and economic development is roughly curvilinear, with levels of engagement in community activities high in low-income, agrarian societies, falling among urbanizing, medium-income states, and high again among advanced, postindustrial societies. This result is consistent with an established sociological literature according to which initial development leads to the breakdown of traditional communal bonds (‘communities of necessity’), based around village or parish networks, which are then reconstructed around friendship and voluntary organizations (‘communities of choice’), once the cost of social organization falls with improved transport, telecommunications, and leisure hours (Tonnies  2001, Castells 2000, Inglehart 1997).
three of the most commonly acknowledged capabilities: health – the ability to live and long and vigorous life; education – the ability to apply knowledge in work, family, and recreational life; and income – the ability to purchase goods and services (UNDP 2007). While a range of other indicators may be appropriate for measuring human development, including survey instruments designed to assess subjective wellbeing and quality of life, as well as a more extensive ‘HDI-plus’ which would include other capabilities (including those measured directly by our social institutional indices), for the purposes of this paper we will work with the categories of the HDI as our main reference.
We begin therefore in Table 1.0 below by examining the relationship between social institutions and the first component of human development, as defined by the HDI, which is health. The tables present the results of simple cross-sectional regression models that use two commonly used health indicators as their dependent variables, namely infant mortality and life expectancy. As independent variables we include all of the six social development indices detailed above, for the most recent 2005 estimate. Also included in the model are a range of control variables commonly identified in the literature as determinants of cross-country health outcomes, notably log GDP together with its square term, women’s education (measured by female progression to secondary school), the quality of governance (measured using the Worldwide Governance Indicator for Voice and Accountability), and the HIV/AIDS adult infection rate. Results of these regressions are shown in Table 1.0 below.
Table 1.0 Regression Models, Social Institutions and Health Outcomes
Female progression to secondary school (%) Log GDP Log GDP squared HIV/AIDS rate Governance (Voice and Accountability)
0.009 (0.051) 17.744 (13.321) -0.629 (0.794) -1.489 (0.092)*** -0.812 (0.993)
0.05 (0.028) 33.028 (7.628)*** -1.698 (0.475)** -1.284 (0.08)*** 0.247 (0.882)
-0.027 (0.203) -92.301 (52.173) 4.482 (3.128) 1.707 (0.366)*** 5.89 (3.986)
-0.2 (0.1) -127.24 (27.349)*** 7.001 (1.702)*** 1.316 (0.286)*** 4.046 (3.164)
-0.305 (0.179) -78.599 (43.606) 4.163 (2.595) 1.91 (0.42)*** 1.219 (3.697)
Gender Equity Civic Engagement Inclusion of Minorities Cohesion Crime Community Proportion of Managers “Men More Right to Job” Constant
-3.562 (6.72) 1.079 (7.94) -1.258 (4.162) 3.816 (3.982) -24.461 (14.586) 4.69 (6.814) -14.064 (58.889) 51
10.833 (5.255)* 10.878 (6.75) -101.021 (30.758)** 82 0.92
-54.606 (26.747)* -81.04 (31.86)* 26.75 (16.584) -24.085 (15.782) 82.511 (58.681) -14.886 (23.007) 486.888 (231.2)* 52 0.84
-77.249 (18.839)*** -93.833 (24.078)*** 698.53 (110.281)*** 83 0.87
-59.181 (24.592)* 21.218 (8.363)* 437.583 (178.757)* 49 0.94
n model r2
* significant at the 0.05 level; ** significant at the 0.01 level; *** significant at the 0.001 level
As would be expected, the HIV/AIDS adult prevalence rate is always significantly associated with poorer health outcomes, while in all but one model, log GDP is significantly associated with better outcomes. Note also, however, that of the six social development indices gender equity is significantly associated with improved life expectancy and infant mortality outcomes, whilst civic engagement is significantly associated with lower levels of infant mortality. The association between norms of gender equity and human development outcomes is doubly notable due to the inclusion of female progression to secondary school as a control variable, thereby countering the possibility that the observed association is due to improved maternal education. A simple interpretation is that in societies where women are treated unequally, women themselves are the more likely victims of domestic abuse, infanticide, and malnutrition, and this finding is consistent with a wide range of country and regional studies examining ‘missing women’ (Sen 1992, Das Gupta 2005). Moreover, this result is not simply an artifact, due to the inclusion of male-female disparities in mortality rates in the construction of the gender equity measure. When a single World Values Survey item on norms of family discrimination - the proportion of parents in the survey sample who agree that ‘a boy has more right to a university education than a girl’ – is included in place of the gender equity construct, the association between discrimination and infant mortality continues to remain significant. The implication is clear: norms of gender discrimination - arbitrary differences in the way women are
treated in the home, workplace, and school - are responsible for higher infant mortality rates and lower life expectancy.
A second aspect of these results worthy of further discussion is the fact that infant mortality is more sensitive to social institutional quality than life expectancy. One explanation may be that infant mortality is more sensitive than life expectancy to the level of equality, with the overwhelming majority of infant deaths being attributable to the poorest families in society (Ross 2006). Levels of civic engagement may therefore act as a more significant predictor of infant mortality than the level of participative government (as measured by the governance indicator for Voice and Accountability) as only in democracies with widespread civic involvement in politics is there mobilisation for policies that help assist the poor.
Social Institutions and Economic Development
Besides physical health, a second indicator used in human development evaluations, notably in the Human Development Index (HDI), is income per capita. Is there evidence that social norms and values, such as norms of fairness and non-discrimination, contribute to rising incomes for all?
As Figures 1.0 show, beyond a certain threshold, GDP per capita and social institutional quality are strongly, and positively, related. This may be due to one of two reasons. First, more robust social institutions may be the outcome of processes of sustained economic development: as societies become more affluent, individuals are empowered materially, educationally, and socially, and this leads to predictable changes in social norms and values. For example, with economic development citizens gain the human and financial resources needed to participate in civic activities; governments can afford to better resource formal institutions such as the police and courts; and women are more likely to receive an education and enter the labor market (Inglehart and Baker 2000). Alternatively, it may be that sustainable long-run economic growth depends upon the existence of a certain form of what Hall and Jones (1999) call ‘social infrastructure’ - the norms, precedents, and cultural expectations that accumulate over the course of a country’s history and help sustain capital accumulation. Institutions distort or protect the pattern of economic incentives, depending upon whether they protect property rights, encourage work, and reduce transaction costs. Such a view is the cornerstone of the new institutional economics (NIE), according to which formal institutions (courts that protect property rights and
enforce the rule of law) and informal institutions (social trust, cohesion, and voluntary activity) constitute long-run determinants of sustained capital accumulation, that is, economic growth (North 1991, Hall and Jones 1999). This relationship between social institutions and growth has been empirically tested in a range of studies within the econometric literature upon social capital (Helliwell and Putnam 1995, Zak and Knack 2001, Beugelsdijk et al. 2004).
We are able to replicate such tests using the new social institutional aggregates. Two forms of econometric analysis are found within the study of economic growth: i) proximate and ii) deepdeterminants determinants models. Proximate determinants are variables that appear in the aggregate production function, such as physical and human capital per worker, and can be investigated through time-series models using the rate of economic growth as the dependent variable, and such factors as average years of worker education as independent variables. Deep determinants, by contrast, are the variables that explain differences in the proximate determinants; they are the underlying, or deep determinants of development, for example geography, trade, or institutional quality (Rodrik 2002). Because present income per capita is simply the cumulative result of long-run average growth, this can be used as the dependent variable in such regression equations.
We begin by presenting a proximate determinants model. Among the most widely cited studies the relationship between social institutions and growth is Knack and Keefer (1997), which showed a strong positive effect of social trust across a sample of 27 countries. This result can be replicated, using the much enlarged sample of countries that is made possible by the new social development indices. As the dependent variable, the models take the average annual rate of economic growth from 1990 to 1999, and as independent variables, the levels of primary and secondary school enrolment in 1990, the price level of investment goods, real GDP per capita in 1990, a dummy variable for whether the country is a former Eastern bloc regime undergoing transition, and each of the five social institutional variables, estimated around a base year of 1990. By including such controls, we fulfill the requirement, suggested by Levine and Renelt (1992), that commonly identified determinants always be included in growth regressions to ensure robust coefficients. The model specification is the same as that of Knack and Keefer (1997), except that the dependent variable covers the decade of the 1990s rather than that of the 1980s, and that a dummy variable has been included to take account of the transition process in former Eastern bloc economies during this period.
Table 2.0 Regression Models, Economic Growth 1990-9
Model 1 Price level of investment goods, 1990 Real GDP per capita, 1990 Primary School Enrollment, 1990 Secondary School Enrollment, 1990 -.0177247 (.0062173)** -.0001051 (.0000761) .0044492 (.0208054) -.007188 (.0205804) -3.039305 (.9948739)** 3.505779 (2.128653) -2.4998 (3.940448) 1.678283 (2.512064) 0.2197413 (3.457139) 9.917424 (4.882278)* .48338 (3.972525)
Model 2 -.0080768 (.0035189)* -.0001292 (.0000535)* -.000623 (.0139137) .0028285 (.0144989) -3.504876 (.7402007)*** 3.068237 (1.317669)*
Model 3 -0.010 (0.006) -0.000 (0.000) 0.004 (0.018) -0.007 (0.017) -2.972** (0.896) 3.964* (1.847) -3.803 (3.426) 2.400 (2.405) 1.424 (3.433)
Model 4 -0.006 (0.003) -0.000** (0.000) -0.001 (0.012) -0.003 (0.013) -3.477*** (0.665) 3.800** (1.236)
Former Eastern Bloc Country, 0-1 Inclusion of Minorities Gender Equity Intergroup Cohesion Local Community
Crime and Interpersonal Trust Civic Engagement Sub-Saharan Africa Latin America and Caribbean Constant N adj. r2
5.275 (5.924) -1.374 (3.526) -2.330* (1.114) -0.879 (1.005)
-1.793* (0.704) -1.211 (0.693) -3.487 (3.898) 98 0.37
-5.668449 (5.024858) 70 0.35
-8.682451 (3.401931)* 98 0.32
-0.621 (5.780) 70 0.40
Dependent Variable: Per Capita Economic Growth Rate, 1990-9 * significant at the 0.05 level; ** significant at the 0.01 level; *** significant at the 0.001 level
Results are shown in Table 2.0. Reassuringly, the models produce similar findings using the 1990s growth data as was found by Knack and Keefer (1997) using data from the 1980s, in particular regarding the significant coefficient for the interpersonal safety and trust variable. The finding that the interpersonal safety and trust variable functions similarly to the social trust variable included in the Knack and Keefer models can be subject to the same interpretation, namely, that security of property rights and reduced transaction costs are essential and independent determinants of economic growth. Using the new indicator series however allows us to estimate this effect for a much larger sample of countries than was previously possible: whereas 29 countries are included in the Knack and Keefer (1997) specification, model n here ranges from 50 to 70 cases. Given the sensitivity of regression models to minor outliers where the sample size is
low, the ability to replicate similar findings across a more representative sample is reassuring evidence of the validity of the initial claims.
These findings also help shed light on other aspects of the growth literature. For example, it is commonplace in some growth regressions, such as those of Alesina et al. (2003) or Easterly and Levine (1997), to include dummy variables for Latin America and Sub-Saharan Africa, on account of their regionally weak growth performance. The need for such variables stems from the endemically slow growth of the respective regions during the periods under consideration, yet a convincing reason needs to be supplied for why these countries should experience a long-run equilibrium growth rate that is inferior to others. The inclusion of variables which proxy for security of property rights, such as the level of crime and trust, or a variable for discrimination and exclusion of minorities, including indigenous peoples and marginalized ethnic groups, provides something in the way of an answer. Both regions perform poorly on both indicators, and when dummy variables are included for each of these respective regions (Models 3 and 4), their coefficients are substantially diminished: the Latin America dummy is not robust to the presence of social institutional aggregates, and the Sub-Saharan Africa variable becomes only weakly significant. Sub-Saharan African countries in the sample score on average about twothirds of a standard deviation below the global mean on crime and interpersonal trust, while Latin American and Caribbean countries score a full standard deviation below this mean. Meanwhile, with respect to inclusion of minorities, Sub-Saharan African societies score on average half of a standard deviation below the global mean, while a number of Latin American societies (in particular in the Andes and Central America) score a full standard deviation or more below this mean. These results support the view that growth may be endogenous to the institutional structure of a society, including the social institutions that govern economic interaction. This includes the extent to which i) social institutions ensure protection of property rights, and ii) allow minority groups to participate equally in economic processes, such that they can draw the maximum return from their stock of human and economic capital. Because SubSaharan Africa as well as the Latin America and Caribbean region fare poorly in both regards, this may have restrained long-run equilibrium growth.
Because growth rates are sensitive to a range of short-term factors such as macroeconomic policy, growth spillovers, or changes in commodity and other input prices, limited inferences can be made from decadal panel regressions, and it has become more common to discuss the ‘deep’ or long-term determinants of economic growth. Accordingly, we supplement the above regressions with a deep determinants model of the relationship between different forms of institutions and
GDP. Following standard practice in the deep determinants literature, log GDP per capita is used as the dependent variable, and measures of both formal and informal institutions as independent variables. As measures of formal institutions, we include the Worldwide Governance Indicator for Rule of Law (Kaufman, Kraay and Maastruzzi 2007) and the Ease of Doing Business Index (World Bank 2007). The Worldwide Governance Indicator for Rule of Law is a measure of the extent to which agents have confidence in and abide by the rules of society, including the quality of contract enforcement and property rights, the police, and the courts, as well as the likelihood of crime and violence (Kaufman, Kraay and Maastruzzi 2007). The Ease of Doing Business Index measures the costs to firms of business regulations, including in such areas as starting a business, employing workers, and paying taxes (World Bank 2008). As measures of informal institutions, we include each of our five social institutional measures, as outlined in this document: civic activism, clubs and associations, intergroup cohesion, interpersonal safety and trust, and gender equity.
Because of the endogeneity between formal and informal institutions and growth, both the formal and informal institutional variables are instrumented. As instruments for informal institutions, we include the fraction belonging to each of the major religious denominations, as provided by La Porta et al. (1997). A strong case can be made that religious beliefs act as a major force conditioning the social norms and conventions that exist in society; furthermore, a long literature has addressed the relationship between social institutions and economic activity, notably the role of Protestantism in fostering greater norms of social trust, membership of clubs and associations, and civic activism (Weber 1958). Following the argument that hierarchical religions foster lower interpersonal trust than more horizontal systems, Zak and Knack (2001) use the proportion of the population that is Catholic, Muslim or Eastern Orthodox as an instrument for social trust. As instruments for formal institutions, we include the Bockstette et al. (2002) indicator for state history, and the proportion of European language speakers as a percentage of total population, as provided by Hall and Jones (1999). The argument for state history as a determinant of good governance is made by Bockstette et al. (2002), while the argument for the proportion of European settlers as a determinant of contract security and regulatory quality has been made by (among others) Acemoglu, Johnson and Robinson (2001), who contend that in countries where European settlers were able to settle in large numbers, they established institutions to defend property rights, whereas in countries where Europeans were able to rule but not to settle, they established extractive institutions which set a norm for predatory state behavior.
Tables 3.0 Two-Stage Least Squares Models, Log GDP per capita Rule of Law Civic Activism Safety and Trust Intergroup Cohesion Gender Equity Clubs and Associations Inclusion of Minorities Constant N Adj. r2 4.758 (1.617)** 103 0.79 8.800 (0.622)*** 98 0.70 9.302 (0.701)*** 104 0.75 6.312 (0.554)*** 109 0.81 10.921 (0.833)*** 74 0.56 0.237 (0.392) 6.975 (2.947)* -0.417 (1.271) -1.411 (1.351) 4.440 (1.087)*** -4.097 (1.466)** 0.001 (1.485) 8.693 (0.494)*** 64 0.73 1.174 (0.141)*** 1.251 (0.109)*** 0.661 (0.141)*** 1.163 (0.113)*** 0.996 (0.302)**
Doing Business Index Civic Activism Safety and Trust Intergroup Cohesion Gender Equity Clubs and Associations Inclusion of Minorities Constant N Adj. r2
0.003 (0.007) 7.795 (2.562)**
1.402 (1.327) -1.215 (1.749) 4.513 (1.263)*** -3.026 (1.291)* 1.885 (1.424) 9.230 (1.042)*** 63 0.67
4.528 (2.018)* 96 0.79
9.728 (0.860)*** 92 0.62
11.368 (1.104)*** 99 0.61
7.398 (0.908)*** 103 0.79
12.534 (0.793)*** 72 0.58
All independent variables instrumented using: fraction of population Protestant; Catholic; Buddhist; Muslim; Orthodox; fraction of population speaking European languages; state history. Dependent variable: Log GDP per capita.
Results are presented in Tables 3.0. Two social institutional measures emerge as significant when tested together with formal institutions: civic activism and gender equity. Safety and trust and intergroup cohesion are not significant when tested together with a measure for rule of law, which possibly indicates that these are in part second-order effects of formal institutional quality (Foa 2008). However, as suggested in our analysis of the proximate determinants of economic
growth above, norms of trust and cooperation may be a proximate determinant of development. The results suggest important long-term consequences of informal institutions upon the process of economic development.
In recent years, there has been a simmering interest in measuring broader facets of human development, such as non-discrimination, freedom from criminal or ethnic violence, and access to civic and social life. However, empirical hypothesis testing has been held back by a lack of available cross-country comparative measures. This paper uses a new set of social institutional indices compiled using over 200 indicators drawn from a set of 25 available sources, to further the work in this field. Given the breadth of sources used, this constitutes the first truly global set of indices of social norms and practices based on comparative public perception and survey data. In brief empirical tests, this article has presented evidence suggestive of multiple linkages between social institutions and broader aspects of human development. Norms of equality and non-discrimination against women are found to have significant independent effects upon aggregate health outcomes, even after controlling for other relevant factors. Meanwhile, interpersonal trust and norms of non-discrimination against ethnic, religious and caste minorities are to found to be proximate determinants of economic growth, while countries with higher civic engagement, and stronger norms of equality and fairness toward women, are found to achieve significantly higher levels of income per capita in the long-run, even after controlling for the quality of formal institutions or governance. The results suggest therefore that social institutions are not simply an ‘effect’ of economic processes, but a constitutive factor in human and economic outcomes. Social norms such as the fair treatment of minorities, opportunities for women’s empowerment, and conventions of reciprocity and trust play an independent role in attaining better health and economic outcomes, over and above their direct contributions to human wellbeing.
Acemoglu, D., Johnson, S., and Robinson, J. (2001). “The Colonial Origins of Comparative Development: An Empirical Investigation”. American Economic Review, December 2001. Acemoglu, D. and Robinson. J. (2006). Economic Origins of Dictatorship and Democracy. New York: Cambridge University Press. Alesina, A., Baqir, R., Easterly, W. (1999). "Public Goods and Ethnic Divisions", Quarterly Journal of Economics, 114(4), 12431284. Alesina, A., Devleeschauwer, A., Easterly, W., Kurlat, S., Wacziarg, R. (2003) “Fractionalization”, Journal of Economic Growth. 8 (2): 155-194. Almond, G. and Verba, S. (1963). The Civic Culture: Political Attitudes and Democracy in Five Nations. Princeton: Princeton University Press. Arrow, K. (1974). The Limits of Organization. Norton, New York. Barro, R. (1991). “Economic Growth in a Cross-Section of Countries”. Quarterly Journal of Economics. 6, 407-444. Bebbington, A., Guugenheim, S., and Woolcock, M. (2006). “Concepts: Their Context and Their Consequences”, In Anthony J. Bebbington, Michael Woolcock, Scott Guggenheim, and Elizabeth A. Olson, eds., The Search for Empowerment: Social Capital as Idea and Practise in the World Bank. Connecticut: Kumarian Press. Berkman, L. and Syme, L. (1979). “Social Networks, Host Resistance, and Mortality: a Nine-Year Follow-Up Study of Alameda County Residents.” American Journal of Epidemiology. 109, no. 2: 186-204. Beugelsdijk, S., de Groot, H., and van Schaik, A. (2004). "Trust and economic growth: a robustness analysis", Oxford Economic Papers, 56, 118-134. Bockstette, V., Chanda, A. and Putterman, L.. (2002). “States and Markets: The Advantage of an Early Start,” Journal of Economic Growth 7, 347-369. Castells, M. (2000). The Rise of the Network Society. Malden, MA: Blackwell Publishers. Coffé, H. and Geys, B. (2005). “Institutional Performance and Social Capital: An Application to the Local Government Level”, Journal of Urban Affairs 27 (5): 485-501. Coleman, J. (1988). “Social Capital in the Creation of Human Capital”, American Journal of Sociology, vol. 94, pp. s95-s120. Collier, P. (1999). "On the Economic Consequences of Civil War", Oxford Economic Papers, 51:168-183. Cox, D., Eser, Z. and Jiminez, E. (1997). “Family Safety Nets in Economic Transition.” In Jein Klugman, ed., Poverty in Russia: Public Policy and Private Responses. Washington DC: World Bank. Easterly, W., and Levine, R. (1997). “Africa’s Growth Tragedy: Policies and Ethnic Divisions”, The Quarterly Journal of Economics, 112(4), pp. 1203-1250. Easterly, W., Ritzen, J., and Woolcock, M. (2006). “Social Capital, Institutions, and Growth”, Economics and Politics 18 (2): 0954-1985. Esteve-Volart, B. (2004). “Gender discrimination and growth: Theory and evidence from India.” DEDPS Working Paper No. 42. London: London School of Economics and Political Science. Etzioni, A. (1997). The New Golden Rule: Community and Morality in a Democratic Society. London: Profile Books. Evans, P. (1996). "Government Action, Social Capital and Development: Reviewing the Evidence on Synergy", World Development, 24(6), pp. 1119-1132.
Fearon, J., Laitin, D. (1996), “Explaining Interethnic Cooperation”, American Political Science Review, 90(4), 715-735 Fukuyama, F. (1995). Trust: Social Virtues and the Creation of Prosperity. NY: Free Press. Grootaert, C. (2001). “Does social capital help the poor? A synthesis of findings from the local level institutions studies in Bolivia, Burkina Faso and Indonesia”, World Bank Local Level Institutions Working Paper No. 10. World Bank: Washington, DC. Grootaert, C. and Bastelaer, T. V. (2002). “Social Capital: From Definition to Measurement”, In Christiaan Grootaert and Thierry van Bastelaer, eds., Understanding and Measuring Social Capital: A Multidisciplinary Tool for Practitioners. The World Bank, Washington, D.C. Guggenheim, S. (2006). “Crises and Contradictions: Understanding the Origins of a Community Development Project in Indonesia”. In Bebbington, Woolcock, Guggenheim and Olson (eds.), The Search for Empowerment. CT: Kumarian Press. Hall, R. and Jones, C. (1999). “Why do Some Countries Produce so Much More Output Per Worker Than Others?” Quarterly Journal of Economics 114, 83-116. Helliwell, J. (2003). "How's Life? Combining Individual And National Variables To Explain Subjective Well-Being," Economic Modelling, v20, 331-360. Helliwell, J. and Putnam, R. (1995). Economic growth and Social Capital in Italy. Eastern Economic Journal 21 (3), pp. 295– 307. Inglehart, R. (1997). Modernization and Postmodernization. Princeton: Princeton University Press. Inglehart, R. and Baker, W. (2000). “Modernization, Cultural Change, and the Persistence of Traditional Values,” American Sociological Review 65, 19-51. Inglehart, R. and Welzel, C. (2005). Modernization, Cultural Change and Democracy. Cambridge University Press. Kaufmann, D., Kraay, A., and Zoido-Lobatόn, P. (1999a). “Aggregating Government Indicators.” World Bank Policy research Working Paper No. 2195, Washington, D.C. Kaufmann, D., Kraay, A., and Zoido-Lobatόn, P. (1999b). “Governance Matters.” World Bank Policy research Working Paper No. 2195, Washington, D.C. Kaufmann, D., Kraay, A., and Mastruzzi, M. (2007). “Governance Matters VI: Aggregate and Individual Governance Indicators 1996-2006”, World Bank Policy Research Working Paper No. 4280, Washington, D.C. King, E. and Hill, A. (1993). Women’s Education in Developing Countries: Barriers, Benefits and Policies. John Hopkin University Press, Baltimore. Knack, S. (2002). “Social Capital and the Quality of Government: Evidence from the States”, American Journal of Political Science 46 (4): 772-785. Knack, S., and Keefer, P. (1997). “Does Social Capital have an Economic Payoff? A Cross-Country Investigation”, The Quaterly Journal of Economics 112 (4):1251-1288. Knowles, S. and Weatherston, C. (2007). "Informal Institutions and Cross-Country Income Differences", CREDIT Discussion Paper no. 06/06. La Porta, R., Lopez-de-Silane, F., Shleifer, A., and Vishny, R. (1997). "Trust in Large Organizations", American Economic Review, American Economic Association, vol. 87(2), pp. 333-38. Lam, W.F. (1994). “Institutions, Engineering Infrastructure, and Performance in the Governance and Management of Irrigation Systems: The Case of Nepal.” Ph.D. dissertation, School of Public and Environmental Affairs and Department of Political Science, Indiana University, Bloomington. Lam, W.F. (1996). "Institutional Design of Public Agencies and Co-Production: A Study of Irrigation Associations in Taiwan," World Development, vol. 24, no. 6. Lambsdorff, J. G. (2006). "The Methodology of the Corruptions Perceptions Index", Transparency International and the University of Passau, permanent url: http://www.icgg.org/downloads/CPI_2006_Methodology.pdf
Morrison, A., and Lamana, F. (2006). Gender issues in the Kyrgyz labor market. Background paper for Kyrgyz Poverty Assessment. Washington, DC: World Bank. Narayan, D. and Pritchett, L. (1999). “Cents and Sociability: Household Income and Social Capital in Rural Tanzania”, Economic Development and Cultural Change 47(4): 871-97. Norris, P. (ed). (1999). Critical Citizens: Global Support for Democratic Governance. Oxford: Oxford University Press. North, D. (1990). Institutions, Institutional Change and Economic Performance. Cambridge: Cambridge University Press. North, D. (1991). "Institutions," Journal of Economic Perspectives, American Economic Association, vol. 5(1), pages 97-112. Ostrom, E. (1996). “Crossing the Great Divide: coproduction, synergy, and development”, World Development. 24, 6: 107387. Paxton, P. (2002). "Social Capital and Democracy: An Interdependent Relationship." American Sociological Review, 67:254277. Posner, D. (2004). “Measuring Ethnic Fractionalization in Africa,” American Journal of Political Science 48, 4, pp. 849-863. Putnam, R., Leonardi, R. and Nanetti, R. (1993) Making Democracy Work: Civic Traditions in Modern Italy. Princeton: Princeton University Press. Putnam, R. (2000). Bowling Alone: The Collapse and Revival of American Community. New York: Simon and Schuster. Putnam, R. (2007). "E Pluribus Unum: Diversity and Community in the Twenty-first Century", Scandinavian Political Studies, 30 (2), 137–174. Rice, T. and Feldman, J. (1997). “Civic Culture and Democracy from Europe to America,” Journal of Politics, 59:1143-1172. Robinson, J., and Verdier, T. (2002). "The Political Economy of Clientelism," CEPR Discussion Papers 3205. Rodrik, D., Subramanian, A. and Trebbi, F. (2004). “Institutions Rule: The Primacy of Institutions Over Geography and Integration in Economic Development”, Journal of Economic Growth, 9, 131-165. Schultz, P. (2002). “Why governments should invest more to educate girls.” World Development, 30(2): 207-225. Tabellini, G. (2005). "Culture and Institutions: Economic Development in the Regions of Europe", CESifo Working Paper Series, CESifo Working Paper No. 1492. Tendler, J. (1995). Social Capital and the Public Sector: The Blurred Boundaries Between Private and Public, Dept. Of Urban Studies and Planning. MIT: Cambridge, MA. Thomas, D., Strauss, J. and Henriques, M. 1991. "How Does Mother's Education Affect Child Height?" Journal of Human Resources, 26, no. 2:183-211. Tonnies, F. ( 2001). Community and Civil Society. Cambridge: Cambridge University Press. Varshney, A. (2001). “Ethnic Conflict and Civil Society: India and beyond”, World Politics 53 (3) 362-98. Woolcock and Narayan. (2000). "Social Capital: Implications for Development Theory, Research, and Policy", World Bank Research Observer, Vol. 15, 2, pp. 225-249. World Bank. 2001. Engendering development: Through Gender Equality in Rights, Resources, and Voice. New York: Oxford University Press. Zak, P. and Knack, S. (2001). “Trust and Growth,” Economic Journal 111, 295-321.
Figure 1.0 Social Institutions and Log GDP per Capita
12 Log GDP per capita, 2005
12 Log GDP per capita, 2005 11 10 9 8 7 6 0 0.1
Clubs and Associations
11 10 9 8 7 6 0 0.2 0.4 0.6 0.8 1 Civic Engagement
Intergroup Cohesion Intergroup Cohesion
12 Log GDP per capita, 2005
Interpersonal Safety and Crime and Interpersonal TrustTrust
12 Log GDP per capita, 2005 11 10 9 8 7 6 0.8 0.85 0.9 0.95 1 1.05 Crime and Interpersonal Trust
11 10 9 8 7 6 0 0.2 0.4 0.6 0.8 1 Intergroup Cohe sion
Gender Equity Gender Equity
12 Log GDP per capita, 2005 11 10 9 8 7 6 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 Ge nder Equity
Inclusion of Minorities
12 11 10 9 8 7 6 0 0.2 0.4 0.6 0.8 1 1.2 Inclusion of Minorities
Figure 2.0 Social Institutions and Government Effectiveness
Civic Engagement Civic Activism
Local Community Clubs and Associations
Government Effectiveness, 2005
Government Effectiveness, 2005
0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1
-3 0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4 0.45 0.5
Civic Capacity, 2005
Local Community, 2005
Intergroup Cohesion Intergroup Cohesion
Interpersonal Safety and Trust Crime and Interpersonal Trust
Government Effectiveness, 2005
Government Effectiveness, 2005
0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1
-3 0.6 0.65 0.7 0.75 0.8 0.85 0.9 0.95 1
Intergroup Cohesion, 2005
Crime and Personal Safety, 2005
Gender Equity Gender Equity
Inclusion of Minorities
Government Effectiveness, 2005
-3 0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4 0.45 0.5
-3 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1
Gender Equity, 2005
Inclusion of Minorities, 2005
Indicator Source Coverage
Proportion of public who have listened to radio news ‘in the last day’ or ‘several times in the last week’ Proportion of public who have watched TV news ‘in the last day’ or ‘several times in the last week’ Proportion of public who have read newspaper news ‘in the last day’ or ‘several times in the last week’ Civicus civil society rating — Structure Civicus civil society rating — Environment Civicus civil society rating — Values Civicus civil society rating — Impact Radios per capita Radios per household Proportion of public who ‘have’ or ‘would be prepared’ to take part in a peaceful demonstration Proportion of public who ‘have’ or ‘would be prepared’ to sign a petition Respondent says they use the radio to inform themselves about politics Respondent says they use the newspaper to inform themselves about politics Respondent says they use the television to inform themselves about politics Percentage of respondents who watch TV news a great deal or very much Percentage of respondents who read newspaper news a great deal or very much Percentage of respondents who listen to radio news a great deal or very much Average number of days spent watching TV news, per week Average number of days spent reading newspaper news, per week Average number of days spent listening to radio news, per week Density of international organisation secretariats of international non-governmental organizations in given country Extent to which organisations and individuals in each country are members of INGOs, number of INGOs with members in that country Percentage of the workforce employed in the NGO sector Newspapers per capita Daily newspaper titles, per capita Proportion of respondents who either 'have done' or 'might' sign a petition Proportion of respondents who either 'have done' or 'might' join a boycott
Afrobarometer Afrobarometer Afrobarometer Civicus Civicus Civicus Civicus ITU ITU Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Global Civil Society Project Global Civil Society Project SAIS UNESCO UNESCO World Values Surveys, Latinobarometer World Values Surveys World Values Surveys, Afrobarometer, Latinobarometer
16 16 16 37 37 37 37 197 197 19 18 18 18 18 18 18 18 19 19 19 175 176 36 107
Proportion of respondents who 'have done' or 'might' attend a peaceful demonstration
Proportion of respondents who have used a daily newspaper in the last week to find out what is going on in the world Proportion of respondents who have used news broadcasts on radio or TV in the last week to find out what is going on in the world Proportion of respondents who have used printed magazines in the last week to find out what is going on in the world Proportion of respondents who have used in depth reports on radio or TV in the last week to find out what is going on in the world Proportion of respondents who have used books in the last week to find out what is going on in the world Proportion of respondents who have used internet or email in the last week to find out what is going on in the world
World Values Surveys World Values Surveys World Values Surveys World Values Surveys World Values Surveys World Values Surveys
22 22 22 22 22 22
Clubs and Associations
Indicator Source Coverage
Respondent says that they use their free time to participate in voluntary associations Respondent says that they use their free time to work for local or community development groups Percentage respondents who are members of youth groups Percentage of respondents who are members of women's groups Percentage of respondents who are members of sports clubs Percentage of respondents who are members of church groups Percentage of respondents who work for an issue that affects their community 'very frequently' or 'frequently' Percentage of respondents who are members of labor unions Percentage of respondents who are members of voluntary associations Percentage of respondents who are members of a political party Percentage of respondents who are members of a cultural center Active or inactive member of religious group Active or inactive member of development association Has or would be prepared to attend community meeting Active or inactive member of labor union Active or inactive member of business group Percentage respondents saying that people generally help one another in their neighborhood Proportion of respondents who are active or inactive members, church or religious organization Proportion of respondents who are active or inactive members, sports or recreational organization Proportion of respondents who are active or inactive members, other voluntary associations Participate in youth associations and groups Belong to sports club Respondent has conducted unpaid voluntary health work Respondent belongs to conservational organization Respondent belongs to women's organization Respondent belongs to peace movement Proportion of respondents who are active or inactive members, arts, music, or educational organization Proportion of respondents who are active or inactive members, labor union Proportion of respondents who are active or inactive members, environmental organizations Proportion of respondents who are active or inactive members, professional organizations
Latinbarometer Latinbarometer Latinbarometer Latinbarometer Latinbarometer Latinbarometer Latinbarometer Latinbarometer Latinbarometer Latinbarometer Latinbarometer Afrobarometer Afrobarometer Afrobarometer Afrobarometer Afrobarometer International Crime Victim Survey World Values Survey World Values Survey World Values Survey World Values Survey World Values Survey World Values Survey World Values Survey World Values Survey World Values Survey World Values Survey World Values Survey World Values Survey World Values Survey
18 18 18 18 18 18 18 18 18 18 18 16 16 16 16 16 59 57 58 56 58 58 54 62 58 56 58 58 57 76
Proportion of respondents who are active or inactive members, human rights organizations Proportion of respondents who are active or inactive members, consumer groups Spent time socializing with friends in last month or last few weeks Spent time socializing with other members of arts or cultural association in last month or last few weeks Member of church or religious organization Member of neighborhood group
World Values Survey World Values Survey World Values Survey World Values Survey International Social Survey International Social Survey
66 22 64 58 27 27
Indicator Source Coverage
Number of reported incidents of violent riots Number of reported incidents of assassinations Number of reported incidents of terrorist acts Number of reported incidents of guerrilla activity Economist Intelligence Unit rating on likelihood of violent demonstrations Economist Intelligence Unit rating on potential for terrorist acts Rating on the ‘legacy of vengeance-seeking group grievance or group paranoia’ Level of civil disorder, International Country Risk Guide rating Level of internal conflict, International Country Risk Guide rating Risk of terrorism, International Country Risk Guide rating Level of ethnic minority rebellion in country
Databanks Databanks Databanks Databanks Economist Intelligence Unit Economist Intelligence Unit Fund for Peace International Country Risk Guide International Country Risk Guide International Country Risk Guide Minorities at Risk
189 189 189 121 121 121 176 140 140 140 118
Interpersonal Safety and Trust
Felt unsafe in home, proportion saying 'never' Had stuff stolen from home, proportion saying 'never' Been attacked, proportion saying 'never' Proportion of respondents who say that 'in general, most people can be trusted' Proportion of respondents who say that most people try to be fair, rather than take advantage of you when given the chance Economist Intelligence Unit rating on social distrust Percentage respondents feel 'very safe' or 'fairly safe' walking alone in their area after dark Percentage respondents feel 'very safe' or 'fairly safe' while at home after dark Percentage respondents who avoid places when they go out Percentage respondents who take company with them when they go out Percentage respondents experienced a car theft in last 5 years Percentage respondents experienced heft from car in last 5 years Percentage respondents experienced damage to car in last 5 years Percentage respondents experienced motor theft in last 5 years Percentage respondents experienced burglary in last 5 years Percentage respondents experienced attempted burglary in last 5 years Percentage respondents experienced garage theft in last 5 years Percentage respondents experienced robbery in last 5 years Percentage respondents experienced personal theft in last 5 years Percentage respondents experienced sexual offence in last 5 years Percentage respondents experienced assault in last 5 years Interpol homicide rate Interpol rape rate Interpol rate of serious assault Interpol rate of aggravated theft
Afrobarometer Afrobarometer Afrobarometer Asian Barometer Asian Barometer Economist Intelligence Unit International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey International Crime Victim Survey Interpol Interpol Interpol Interpol
16 16 16 10 10 121 64 37 56 67 67 67 67 67 66 67 28 66 67 67 67 124 54 57 52
Interpol rate of breaking and entering Interpol vehicle theft rate Interpol ‘other theft’ rate Interpol fraud rate Interpol consumer fraud rate WHO homicide rate Respondent or someone in their family assaulted in the last 12 months Percentage of respondents who feel secure in the neighborhood in which they live Percentage of respondents who have been the victim of a street crime Percentage of respondents who have been the victim of burglary Percentage of respondents who have been the subject of attempted homicide Percentage of respondents who have been the subject of attempted abduction State Department crime advisories, coded 1-5
Interpol Interpol Interpol Interpol Interpol World Health Organization Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer US State Department United Nations Criminal Justice Information Network World Development Indicators World Values Survey, Afrobarometer, Latinobarometer World Values Survey World Values Survey World Values Survey World Values Survey
57 59 59 59 56 102 19 17 17 17 17 17 186
UNCJIN homicide rate Percentage of managers surveyed for whom crime is a major business constraint
Proportion of respondents who say that 'in general, most people can be trusted' Proportion of respondents who say that most people try to be fair, rather than take advantage of you when given the chance Proportion of respondents who do not very much or do not at all trust their neighborhood Proportion of respondents who do not very much or do not at all trust people they know personally Proportion of respondents who do not very much or do not at all trust people they meet for the first time
86 40 22 22 22
Inclusion of Minorities
Indicator Source Coverage
Which of the following groups is most discriminated against in this country – or are there no such groups? Combined percentage citing: blacks, indigenous peoples, mulattos, mestizos, Asians, Arabs, Jews, immigrants, the disabled, those with AIDS, homosexuals Average perceived level of discrimination against indigenous peoples in the workplace (1-10), among all respondents in country who identify as indigenous or mestizo Average perceived level of discrimination against indigenous peoples in schools and colleges (1-10), among all respondents in country who identify as indigenous or mestizo Average perceived level of discrimination against indigenous peoples in political parties (1-10), among all respondents in country who identify as indigenous or mestizo Average perceived level of discrimination against indigenous peoples by the police (1-10), among all respondents in country who identify as indigenous or mestizo Average perceived level of discrimination against indigenous peoples in the courts (1-10), among all respondents in country who identify as indigenous or mestizo Average perceived level of discrimination against blacks in the workplace (1-10), among all respondents in country who identify as black or mulatto Average perceived level of discrimination against blacks in schools and colleges (1-10), among all respondents in country who identify as black or mulatto Average perceived level of discrimination against blacks in the political parties (1-10), among all respondents in country who identify as black or mulatto Average perceived level of discrimination against blacks by the police (1-10), among all respondents in country who identify as black or mulatto Average perceived level of discrimination against blacks in the courts (1-10), among all respondents in country who identify as black or mulatto Of all the reasons people are not treated equally, which of the following most affect you? Discrimination due to skin color, discrimination against immigrants economic situation of ethnic group is 'same' as other groups political position of ethnic group is 'same' as other groups ethnic group 'never' treated unfairly Rating on level of uneven economic development along group lines proportion of respondents who do not very much or do not at all trust people of another religion proportion of respondents who do not very much or do not at all trust people of another nationality proportion of respondents who trust people from other ethnic groups 'not at all' or 'just somewhat' Percentage of respondents who feel that 'being of the same ethnic group' is very important in a marriage proportion of respondents refusing to have as neighbors people of a different race or caste proportion of respondents refusing to have people who have AIDS as neighbors proportion of respondents refusing to have immigrants or foreign workers as neighbors proportion of respondents refusing to have homosexuals as neighbors proportion of respondents refusing to have people of a different religion as neighbors log minority size, * average levels of economic discrimination log minority size, * average economic disparity between group and population
Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Latinobarometer Afrobarometer Afrobarometer Afrobarometer Fund for Peace World Values Surveys World Values Surveys World Values Surveys World Values Surveys World Values Surveys World Values Surveys World Values Surveys World Values Surveys World Values Surveys Minorities at Risk Minorities at Risk
18 18 18 18 18 18 18 18 18 18 18 16 16 16 176 87 87 87 87 87 87 87 87 87 118 118
Indicator Source Coverage
Percentage agreeing that a married man has a right to beat his wife and children Percentage of respondents who tend to agree or strongly agree that 'women have always been subject to traditional laws and customs, and should remain so'. Percentage of respondents who tend to agree or strongly agree that 'women should have the same chance of being elected to political office as men'. Rating on level of women's economic rights Rating on level of women's social rights Ratio of average female to male wages, across all available labor categories Percentage of women who agree that women have the same chance as men to get a good job in their country Percentage of women who agree that women have the chance to earn the same salary as men in their country Percentage of women who agree that women have the same chance as men to get a good education in their country Proportion of employers and managers who agree or strongly agree that when jobs are scarce, men have more right to a job than women Proportion of those of voting age who agree or strongly agree that on the whole, men make better political leaders than women do Proportion of parents who agree or strongly agree that a university education is more important for a boy than a girl Proportion of employers and managers who agree or strongly agree that on the whole, men make better business executives than women do Percentage of labor force that is female Ratio of females among legislators, senior officials and managers Ratio of females in professional jobs Ratio between female and male primary school enrollment Ratio between female and male secondary school enrollment Ratio between female and male tertiary educational enrollment Ratio between adult female and male literacy rates Ratio between adult female and adult male mortality rates
Afrobarometer Afrobarometer Afrobarometer CIRI CIRI International Labor Organization Latinobarometer Latinobarometer Latinobarometer World Values Surveys World Values Surveys World Values Surveys World Values Surveys World Development Indicators International Labor Organization International Labor Organization World Development Indicators World Development Indicators World Development Indicators World Development Indicators World Development Indicators
15 15 4 190 190 65 18 19 18 83 74 75 23 186 94 136 175 150 173 146 195