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Global Competitiveness Index

Producer: 

World Economic Forum with Columbia University

Stated Purpose: 

The Global Competitiveness Index (GCI) attempts to quantify the impact of a number of key factors which contribute to create the conditions for competitiveness, with particular focus on the macroeconomic environment, the quality of the country’s institutions, and the state of the country’s technology and supporting infrastructure.

Area of Governance: 
Governance and MDG
Public Administration
Funding Source: 

Private sector companies and participation fees from annual meetings.

Current usage: 

The GCI is widely quoted in the media and in academic research.

Type of data used: 

Administrative data (publicly available data), such as enrollment rates, government debt, budget  deficit, and life expectancy, which are obtained from  internationally recognized agencies, notably the United  Nations Educational, Scientific and Cultural Organization  (UNESCO), the IMF, and the World Health Organization  (WHO). Furthermore, it uses data from the World Economic Forum’s annual Executive Opinion Survey (Survey)

Coverage: 

Country Coverage:  The geographical coverage varies, the lastest index (2012) covering 144 countries . 

Year Coverage: 2006 - present (update annually). The GCI is a more comprehensive version of the previously used Growth Competitiveness Index (1979).  
Contact details: 

For more information on the survey contact: gcp@weforum.org.

Methodology: 

The GCI measures “the set of institutions, factors and policies that set the sustainable current and medium-term levels of economic prosperity” (in other words, those factors that facilitate or drive productivity). The index is composed of 12 pillars of competitiveness. The index attempts to take into account countries' different stages of economic development, and organises the pillars into three subindexes: Efficiency enhancers, Innovation and sophistication factors. The pillars are organised as followed:  

Basic requirements  

  • Institutions
  • Infrastructure
  • Macroeconomic Stability
  • Health and Primary Education

Efficiency enhancers

  • Higher Education and Training
  • Goods Market Efficiency
  • Labour Market Efficiency
  • Financial Market Sophistication
  • Technological Readiness
  • Market Size

Innovation and sophistication factors  

  • Business Sophistication
  • Innovation

The survey questionnaire connected to these 12 pillars is designed to capture a broad range of factors affecting an economy’s business climate that are critical determinants of sustained economic growth.

Format of results: 

Uses a 1-7 scale (higher average score means higher degree of competitiveness).

Valid Use: 

The GCI is a helpful tool to assess economic competitiveness.

Invalid Use: 

Although the CGI assesses several aspects related to governance such as public trust in institutions, judicial independence and corruption, these are limited measures of governance. There is also a strong business bias regarding governance related aspects, which is reflected by the questions and respondents of the Executive Opinion Survey. Consequently, the GCI should be used very cautiously as a governance index per se. The GCI points out that the ranking is based on relative positioning, thus one country movement on the list is not necessarily due to changes in the country but rather in other countries (i.e. if one country goes up another has to go down).

Assumption: 

Weighting used in constructing index is appropriate.

Example results: 

Global Competitiveness Report 2012 - 2013