Governance Infrastructure and High Quality Democracy : A Theoretically Motivated Concept Construction and Necessary Condition Analysis

Two of the most relevant determinants of a state’s economic outcomes are its governance and regime type. Governance is an ambiguous concept and while being defined in an ad hoc manner by institutions such as the World Bank, there is no agreed upon definition. In this paper I create a new concept, called governance infrastructure which seeks to increase the concept-measure consistency of governance and thereby eliminate how previous iterations of governance have overlapped with other concepts, specifically regime type and political instability. This will allow social scientists to more readily separate the effects of these varying concepts on economic outcomes. This is important to the discipline as many debates still exist over which is more important for increasing a state’s trade and FDI, the institutions which comprise governance infrastructure, regime type, or political stability. Moreover, I intend to demonstrate that a certain threshold of governance infrastructure is a necessary condition for a state to be a high quality democracy. A state’s governance infrastructure is the core institutions which facilitate government competency and economic efficiency. Certain institutions that have historically been considered inherent in democracies (e.g. property rights) are actually conceptually part of a state’s governance infrastructure. In this paper I will make the important distinction that democracy and governance infrastructure are different, both theoretically and conceptually. A three-level concept construction will be used to create governance infrastructure. The basic level is the overall abstract concept, governance infrastructure. The second level is the theoretical linkage which connects the concept to the actual data and is comprised of bureaucratic governance and socio-economic governance. And the indicator level is the actual measurements of the theoretical linkages (Goertz 2005). Through use of scatter-plots, N x N tables and standardized z-scores, this paper provides evidence that a certain quality level of governance infrastructure is actually a necessary condition for a state to become a high quality democracy. This research gives social scientists a concept-measure consistent conceptualization of governance which allows us to more readily separate the effects of similar concepts on economic outcomes. Additionally, it adds to our knowledge of democracy in that governance infrastructure is a necessary condition for a high quality democracy