Ratings and rankings: Voodoo or Science?

Composite indicators aggregate a set of variables using weights which are understood to reflect the variables' importance in the index. In this paper we propose to measure the importance of a given variable within existing composite indicators via Karl Pearson's `correlation ratio'; we call this measure `main effect'. Because socio-economic variables are heteroskedastic and correlated, (relative) nominal weights are hardly ever found to match (relative) main effects; we propose to summarize their discrepancy with a divergence measure. We further discuss to what extent the mapping from nominal weights to main effects can be inverted. This analysis is applied to five composite indicators, including the Human Development Index and two popular league tables of university performance. It is found that in many cases the declared importance of single indicators and their main effect are very different, and that the data correlation structure often prevents developers from obtaining the stated importance, even when modifying the nominal weights in the set of nonnegative numbers with unit sum.Comment: 28 pages, 7 figure

Risk Analysis of the Romanian Banking System – an Aggregated Balance Sheet Approach

The paper presents a risk analysis for the current Romanian banking system. The analysis is conducted from the point of view of prudential rules and also from the point of view of Romanian banking system’s exposure to foreign funds, considering the consequences of these features, concerning the soundness and reliability of the banking system. The analysis found a manageable risk level, apparently, although during 2009 and 2010 the expansion of risk indicators was accelerated, but finally, in the late 2010, there are some signs of stabilization. The exposure of Romanian banking system to foreign funds was another important risk source. The exposure to foreign funds had an important decrease during 2009, but in 2010 it seems to stabilize.prudential rules, exposure, Basel accords, capital adequacy, Romanian banking system

A practice-related risk score (PRS): a DOPPS-derived aggregate quality index for haemodialysis facilities

Background. The Dialysis Outcomes and Practice Patterns Study (DOPPS) database was used to develop and validate a practice-related risk score (PRS) based on modifiable practices to help facilities assess potential areas for improving patient care. Methods. Relative risks (RRs) from a multivariable Cox mortality model, based on observational haemodialysis (HD) patient data from DOPPS I (1996-2001, seven countries), were used. The four practices were the percent of patients with Kt/V >= 1.2, haemoglobin >= 11 g/dl (110 g/l), albumin >= 4.0 g/dl (40g/l) and catheter use, and were significantly related to mortality when modelled together. DOPPS II data (2002-2004, 12 countries) were used to evaluate the relationship between PRS and mortality risk using Cox regression. Results. For facilities in DOPPS I and II, changes in PRS over time were significantly correlated with changes in the standardized mortality ratio (SMR). The PRS ranged from 1.0 to 2.1. Overall, the adjusted RR of death was 1.05 per 0.1 points higher PRS (P < 0.0001). For facilities in both DOPPS I and II (N = 119), a 0.2 decrease in PRS was associated with a 0.19 decrease in SMR (P = 0.005). On average, facilities that improved PRS practices showed significantly reduced mortality over the same time frame. Conclusions. The PRS assesses modifiable HD practices that are linked to improved patient survival. Further refinements might lead to improvements in the PRS and will address regional variations in the PRS/mortality relationship

Additional measures of progress for Scotland : an analysis of the issues and problems associated with aggregate/composite measures of sustainability

the purpose of this paper is to consider the broad set of issues and problems associated with adopting aggregate measures of sustainability. We do this by first considering what we mean when we talk about 'sustainable development' in a policy context and the role that we want sustainability indicators to play. Two broad types of sustainability are identified and we argue that the role of sustainability indicators depends on which type we are concerned with. This also proves to have a bearing on many of the problems and issues commonly associated with composite or aggregate indicators. In order to consider these problems and issues systematically we initially abstract from examination of any specific candidate. Of course GDP is an aggregate measure, involving valuing output at prices that, in perfect markets, reflect the valuations of individuals. indicators. However, in the latter stages of the paper we illustrate our analysis with a number of candidate measures of sustainability

Analysing banking sector conditions - how to use macro-prudential indicators

This paper presents the methodological and statistical framework for macro-prudential analysis of the financial condition of the EU banking sector that has been adopted by the European System of Central Banks (ESCB). The framework is also a central component of broader financial stability assessments carried out by the ECB in co-operation with national authorities. The framework has three main building blocks, which draw on a large number of macro-prudential indicators. The first block is designed for assessing the financial condition of the banking sector. The second building block provides a framework for analysing potential sources of risk and vulnerability to which banks are exposed and an assessment of the importance of related exposures. The final part of the analysis deals with the resilience of banks vis-à-vis these different sources of risk and vulnerability. Analysing the impact of the identified risks on banks’ financial condition is the ultimate objective of the ESCB banking sector stability analysis.Financial stability, Banking sector, Macro-prudential analysis and indicators, Financial sector statistics.

Regulation, productivity, and growth : OECD evidence

The authors look at differences in the scope and depth of pro-competitive regulatory reforms and privatization policies as a possible source of cross-country dispersion in growth outcomes. They suggest that, despite extensive liberalization and privatization in the OECD area, the cross-country variation of regulatory settings has increased in recent years, lining up with the increasing dispersion in growth. The authors then investigate empirically the regulation-growth link using data that cover a large set of manufacturing and service industries in OECD countries over the past two decades and focusing on multifactor productivity (MFP), which plays a crucial role in GDP growth and accounts for a significant share of its cross-country variance. Regressing MFP on both economywide indicators of regulation and privatization and industry-level indicators of entry liberalization, the authors find evidence that reforms promoting private governance and competition (where these are viable) tend to boost productivity. In manufacturing the gains to be expected from lower entry barriers are greater the further a given country is from the technology leader. So, regulation limiting entry may hinder the adoption of existing technologies, possibly by reducing competitive pressures, technology spillovers, or the entry of new high technology firms. At the same time, both privatization and entry liberalization are estimated to have a positive impact on productivity in all sectors. These results offer an interpretation to the observed recent differences in growth patterns across OECD countries, in particular between large continental European economies and the United States. Strict product market regulations-and lack of regulatory reforms-are likely to underlie the relatively poorer productivity performance of some European countries, especially in those industries where Europe has accumulated a technology gap (such as information and communication technology-related industries). These results also offer useful insights for non-OECD countries. In particular, they point to the potential benefits of regulatory reforms and privatization, especially in those countries with large technology gaps and strict regulatory settings that curb incentives to adopt new technologies.Labor Policies,Public Health Promotion,Health Monitoring&Evaluation,Environmental Economics&Policies,Economic Theory&Research,Governance Indicators,Environmental Economics&Policies,Economic Theory&Research,Health Monitoring&Evaluation,Health Economics&Finance

The problem of evaluating automated large-scale evidence aggregators

In the biomedical context, policy makers face a large amount of potentially discordant evidence from different sources. This prompts the question of how this evidence should be aggregated in the interests of best-informed policy recommendations. The starting point of our discussion is Hunter and Williams’ recent work on an automated aggregation method for medical evidence. Our negative claim is that it is far from clear what the relevant criteria for evaluating an evidence aggregator of this sort are. What is the appropriate balance between explicitly coded algorithms and implicit reasoning involved, for instance, in the packaging of input evidence? In short: What is the optimal degree of ‘automation’? On the positive side: We propose the ability to perform an adequate robustness analysis as the focal criterion, primarily because it directs efforts to what is most important, namely, the structure of the algorithm and the appropriate extent of automation. Moreover, where there are resource constraints on the aggregation process, one must also consider what balance between volume of evidence and accuracy in the treatment of individual evidence best facilitates inference. There is no prerogative to aggregate the total evidence available if this would in fact reduce overall accuracy

Quality of routine health facility data used for newborn indicators in low- and middle-income countries: A systematic review

Background High-quality data are fundamental for effective monitoring of newborn morbidity and mortality, particularly in high burden lowand middle-income countries (LMIC). Methods We conducted a systematic review on the quality of routine health facility data used for newborn indicators in LMIC, including measures employed. Five databases were searched from inception to February 2021 for relevant observational studies (excluding case-control studies, case series, and case reports) and baseline or control group data from interventional studies, with no language limits. An adapted version (19-point scale) of the Critical Appraisal Tool to assess the Quality of Cross-Sectional Studies (AXIS) was used to assess methodological quality, and results were synthesized using descriptive analysis. Results From the 19572 records retrieved, 34 studies in 16 LMIC countries were included. Methodological quality was high (>14/19) in 32 studies and moderate (10-14/19) in two. Studies were mostly from African (n = 30, 88.2%) and South-East Asian (n = 24, 70.6%) World Health Organization (WHO) regions, with very few from Eastern Mediterranean (n = 2, 5.9%) and Western Pacific (n = 1, 2.9%) ones. We found that only data elements used to calculate neonatal indicators had been assessed, not the indicators themselves. 41 data elements were assessed, most frequently birth outcome. 20 measures of data quality were used, most along three dimensions: 1) completeness and timeliness, 2) internal consistency, and 3) external consistency. Data completeness was very heterogeneous across 26 studies, ranging from 0%-100% in routine facility registers, 0%-100% in patient case notes, and 20%-68% in aggregate reports. One study reported on the timeliness of aggregate reports. Internal consistency ranged from 0% to 96.2% in four studies. External consistency (21 studies) varied widely in measurement and findings, with specificity (6.4%-100%), sensitivity (23.6%-97.6%), and percent agreement (24.6%-99.4%) most frequently reported