Ranking the Rich

How the Index Is Calculated The final score for each country in the CGD/FP Commitment to Development Index (CDI) is an average of scores in six different categories. In the aid, investment, migration, and peacekeeping categories, each country receives a score ranging from 0 to 9 points, with 9 points going to the top performer ...

How the Index Is Calculated

The final score for each country in the CGD/FP Commitment to Development Index (CDI) is an average of scores in six different categories. In the aid, investment, migration, and peacekeeping categories, each country receives a score ranging from 0 to 9 points, with 9 points going to the top performer and 0 to any country that makes no contribution at all in the relevant category. In the trade and environment categories, the CDI measures negative contributionssuch as environmental harm and trade barriersso the countries initially receive a negative score (from 0 to 9); then 10 is added to make the scores positive and comparable to the others.

The aid score takes the common measure of official development assistance grants and low-interest loans as a percentage of the donor countrys gross domestic product (GDP), and adjusts that measure to better reflect the quality of the aid. The score discounts tied aidaid that raises costs by compelling recipients to use contractors and consultants from the donor nationby 20 percent and subtracts administrative costs as well as debt payments that the donor nation receives on past aid. Most aid contributions by the United Nations, World Bank, and other multilateral aid programs are not discounted for tying. Aid to poorer nations receives greater weight, as does aid to countries with good governance (low corruption, more political voice for citizens, etc.) compared to other countries at similar income levels.

How the Index Is Calculated

The final score for each country in the CGD/FP Commitment to Development Index (CDI) is an average of scores in six different categories. In the aid, investment, migration, and peacekeeping categories, each country receives a score ranging from 0 to 9 points, with 9 points going to the top performer and 0 to any country that makes no contribution at all in the relevant category. In the trade and environment categories, the CDI measures negative contributionssuch as environmental harm and trade barriersso the countries initially receive a negative score (from 0 to 9); then 10 is added to make the scores positive and comparable to the others.

The aid score takes the common measure of official development assistance grants and low-interest loans as a percentage of the donor countrys gross domestic product (GDP), and adjusts that measure to better reflect the quality of the aid. The score discounts tied aidaid that raises costs by compelling recipients to use contractors and consultants from the donor nationby 20 percent and subtracts administrative costs as well as debt payments that the donor nation receives on past aid. Most aid contributions by the United Nations, World Bank, and other multilateral aid programs are not discounted for tying. Aid to poorer nations receives greater weight, as does aid to countries with good governance (low corruption, more political voice for citizens, etc.) compared to other countries at similar income levels.

The trade score considers rich nations barriers to exports from developing countriesincluding tariffs, quotas, and subsidies for domestic producers. A measure of such barriers accounts for three fourths of the score. The remainder of the score directly measures how much rich nations import from developing countries. Imports from the worlds poorest nations receive greater weight in this part of the score, as do manufactured imports from all developing countries.

Two thirds of the investment score is derived from foreign direct investment flows to developing countries as a share of the investor countrys GDP during 19992001. These values are discounted according to investor countries scores on Transparency Internationals 2002 Bribe Payers Index. The remaining one third of the investment score measures the extent to which governments in rich nations restrict public or private pension funds in their countries from investing in developing countries in particular and, more generally, overseas.

Ninety percent of each nations migration score is derived from the number of legal migrants that each rich country admits from developing nations each year, divided by the receiving countrys total population. The remaining 10 percent measures the aid and assistance that rich nations offer to refugees from poor nations.

The peacekeeping score counts rich countries contributions to international peacekeeping operations during 200001, as a share of GDP. Included are financial contributions to the U.N. peacekeeping program, as well as personnel contributions to U.N. and NATO operations, valued at $10,000 per person per month.

The environment score measures each rich nations depletion of the shared commons (two thirds of the score) and its contribution to international environmental initiatives (one third). The depletion measure includes greenhouse gas emissions per capita, consumption of ozone-depleting substances per capita, and fishing subsidies per dollar of GDP. International contributions considered in the index include the ratification of major environmental treaties and protocols, financial contributions to environmental funds, and government support for the development of clean-energy technologies.

A comprehensive explanation of the data and methodologyfor each policy area and for the index as a wholeis available on the Web site of the Center for Global Development.

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