A Study on the Relationship Between Democracy and Government Effectiveness using Nonparametric Smoothing

This paper investigates the relationship between levels of democracy and government effectiveness in 163 countries. Many previous studies on this issue provide contrasting results, and some of them suggest the existence of a nonlinear relationship between democracy and government effectiveness. With the apparent disadvantage of parametric linear regression method in mind, this study adopts the locally weighted scatterplot smoothing (LOWESS) to further investigate the true nature of the association of the two variables. This study finds that there is a clear nonlinear trend (S-shape) in the relationship between the levels of democracy and government effectiveness. The positive effect of democracy only becomes serious after a country achieves a certain level of democracy. This result could mean that development of democracy alone is not sufficient to enhance government effectiveness and some other social and economic prerequisite conditions should be met to fully utilize the advantage of high-level democracy.