Diversification of good governance in European Union countries using the TOPSIS method

Abstract

ObjectivesThe main goal of this study is to identify and evaluate the level of good governance in European Union countries and to determine whether there is a relationship between good governance and economic growth.Material and methodsEmpirical materials are based on currently available statistical data from Eurostat. In case of unavailability of unit data in the studied year, they were replaced with data from the nearest period, i.e. 2020. Due to the complexity of the analyzed categories and the possibility of ordering objects from best to worst to achieve the goal, we used the TOPSIS method for multidimensional data analysis.ResultsThe study found that the variable with the greatest impact on the ranking achieved by a given country in the GG range was the Corruption Perception Index, followed by the proportion of the population who trust EU institutions. In the presented comparison, three countries, Luxembourg, Germany, and Sweden, occupied the top positions in the GG scale, while Greece and Cyprus were at the bottom. Countries with very high GG accounted for 11% of the total number of EU countries. No countries were identified as belonging to the fourth class, which is characterized by a very low level of GG. The majority of countries, over 67%, were represented by those with medium to low levels of GG.ConclusionsThe analysis allowed for identifying a significant correlation between Good Governance and Economic Growth in European Union countries. It can be assumed that the higher the level of economic development (measured by many SDGs), the lower the level of corruption in state institutions, and the greater the trust of citizens in public institutions, which translates into a higher level of GG.