Presentation on theme: "YES 2013- Oleh Havrylyshyn comment on KUNCIC “Institutional Quality Data Set” [YESTERYEAR,INSTITUTIONS DETERMINED BY THE NOBLE BONA VUCIC --- TODAY.. BY."— Presentation transcript:
YES 2013- Oleh Havrylyshyn comment on KUNCIC “Institutional Quality Data Set” [YESTERYEAR,INSTITUTIONS DETERMINED BY THE NOBLE BONA VUCIC --- TODAY.. BY HIS DESCENDANT ???]
NOVELTY OF PAPER 1.CONSTRUCTS COMPOSITE INST. INDEX: not first, but up to date and different- 2.FACTOR ANALYSIS FOR WEIGHTING GIVES “LATENT INST. QUALITY”… more objective than others using simple average– (M.DeMelo early exception in DEC II paper 1996, factor analysis for transition countries 3. FREE ONLINE AVAILABILITY OF FULL DATA SET!! in July we all start testing KUNCIC INDEX– or maybe September ??
KEY CONCLUSIONS 1.FIVE COUNTRY CLUSTERS, CORRELATED WITH LEVEL OF DEVELOPMENT -- not new, Kaufmann and Kraay showed same– which is good test of reasonableness of KUNCIC index 2.WHITHIN INST. GROUPS--LEGAL, POL, ECON – HOMOGENEITY VERY HIGH… suggesting methodology is good? 3.SELECTIVE (&ILLUSTRATIVE ?) EXPERIMENT OF CHANGE OVER TIME BY COUNTRY, “CONCLUDES” e.g. THAT GERMANY CATCHING UP TO USA ON LEGINST.– THAT TURKEY HAS FASTEST IMPROVEMENTS
KEY ISSUES TO ADDRESS FACTOR WEIGHTING CERTAINLY MORE OBJECTIVE BUT… SELECTIVE CHOICE OF INDICATORS CAN IMPART BIASES COMPARATIVE EXAMPLES. (3 above) TOO LIMITED TO CONCLUDE SO MUCH SEVERAL COUNTRY OR REGION CONCLUSIONS QUESTIONABLE OR STILL SPECULATIVE ( e.g.- p.9: cluster 3 largely Muslim )
OBJECTIVITY AND SELECTION OF INDICATORS.1 p.7 says LIMITING INDICATOR LIST IS SUBJECTIVE ‘TO A DEGREE”-HE UNDERSTATES RISKS OF SERIOUS SUBJECTIVITY > WHAT TO DO ? IN SPIRIT OF PAPER, FOR FULL OBJECTIVITY WHY NOT USE ALL AVAILABLE INDICES?? ( where is all of WB EDB? - govefficiency? Govstability ?; all of POLITYIV;l trade opennes in many? IMF’s fiscal management; AT MIN. ABOVE SHOULD BE PART OF ROBUSTNESS TEST –DOES IT MAKE A DIFFERENCE ??
OBJECTIVITY.2 NOT USING ALL AVAILABLE INDICATORS REQUIRES BETTER EXPLANATION OF CHOICE AND FACING ENDLESS PROBLEM OF SOMEONE DISAGREEING WITH CHOICE: LIBERTARIANS WILL INSIST REGULATORY ENVIRONMENT INCLUDE FRASER INSTITUTE’S MEASURES ; I WOULD WARN THAT FRASER USES SIZE OF GOV. AS NEGATIVE IN MARKET FREEDOM, WHICH ASSUMES ALL GOV IS A BAD.--- BOTTOM LINE:USE ALL AVAILABLE OR FACE ENDLESS QUESTIONING
COMPARATIVE EXAMPLES TOO LIMITED CANNOT ANALYSE LARGE NUMBER OF COMAPRISONS, BUT SIMPLY SHOWING WHAT KUNCIC INDEX SHOWS IS NOT ILLUMUNATING FOR A MORE ANALYTICAL PAPER,COMPARE TIME- PATH OF SME COUNTRIES USING OTHER INDICES CAN EASILY ADD A LITTLE MORE ILLUSTRATION: e.g. 2-3 countries from each cluster DOING THIS SHOULD NOT BE DIFFICULT AND WILL RAISE PAER TO MUCH MORE ANALYTICAL CATEGORY.
SEVERAL QUESTIONABLE CONCLUSIONS A VERY COMMON ERROR IN THIS FIELD IS TO FORGET INST. QUAL. CURVE IS ASYMPTOTIC– hence bottom groups countries can improve much faster; improving countries ( e.g. Central Europe) necessarily slowed down about 2005; and GERor US cannot possibly improve as rapidly as Turkey. – 2 nd diff is proper measure here! P.9 & Tab.2 discussion fairly speculative: is Being Muslim the REASON for low INST? Maybe historically, but paper does not substantiate, only implies.– France really NOT in 5?—HK & SING position so low, sugests too much weight on DEM values, as defined by NAEUR welfare function? …etc.etc.etc…..
.. BUT IN THE END… WHAT ABOUT THE QUALITY OF DEC INSTITUTIONS ….
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