Governance Matters III: Governance Indicators for 1996, 1998, 2000, and 2002

Six dimensions of governance are estimated covering 199 countriesand territories for four periods: 1996, 1998, 2000, and 2002.The indicators are based on several hundred individual variablesmeasuring perceptions of governance drawn from 25 data sourcesconstructed by 18 organizations. These individual measures areassigned to categories capturing key dimensions of governance.An unobserved-components model is used to construct six aggregategovernance indicators in each of the four periods. Point estimatesof the dimensions of governance are provided as well as themargins of errors for each country for the four periods. Methodologicalissues are also addressed, including tests for potential biases,and the interpretation and use of the data, given the estimatedmargins of errors for the indicators. The data and a Web-basedgraphical interface are available online at www.worldbank.org/wbi/governance/govdata2002/index.html.     

Review article: The Hayekian research programme

Andrew Gamble: Hayek: The Iron Cage of Liberty , London, Polity Press, £12.95. 1996, pp. xxi + 221
Jeremy Shearmur; Hayek and After , London, Routledge, £45, 1996, pp.x +257     

Year Twelve Economics Examination: Five Answers to Macroeconomic Questions

In preparing these essays, I sat before a keyboard on a single (long) day, and made a selection under examination conditions of the essays I would prepare, then allocated some 45 minutes each, checking only the word count as I went, aiming for about 1000 words for each essay. I had no notes, texts, tables or other information with me, but I did take breaks between essays. I have done no editing for expression, dates or data since my time expired, but I have added (most of the) endnotes since then, and fixed some terrible typing errors caused by the pressures to which most candidates should easily be able to relate. I tried to write as an advanced teenager with good knowledge of the subject. The essays were selected not merely to maximise my 'marks' in any sense, but to cover a wide range of macroeconomic principles and their application to Australia.     

ARE SERVICES INCOME-ELASTIC? SOME NEW EVIDENCE

The hypothesis that the demand for services is income-elastic tended to find support in early empirical work. Recent studies however, adopting improved methodologies and better international data (based on PPP exchange rates), have challenged this conventional wisdom. Using an updated, disaggregated dataset covering 60 countries in 1980 this paper re-estimates income and price elasticities of demand for services. It rejects the income-elastic argument overall but confirms a wide range of income elasticity estimates (above and below unity) across different types of services. Estimates are also shown to be sensitive to the a priori model of service demand.