This indicator measures country performance on the quality of the electoral process, political pluralism and participation, government corruption and transparency, and fair political treatment of ethnic groups.
Countries are rated on the following factors:
- free and fair executive and legislative elections; fair polling; honest tabulation of ballots;
- fair electoral laws; equal campaigning opportunities;
- the right to organize in different political parties and political groupings; the openness of the political system to the rise and fall of competing political parties and groupings;
- the existence of a significant opposition vote; the existence of a de facto opposition power, and a realistic possibility for the opposition to increase its support or gain power through elections;
- the participation of cultural, ethnic, religious, or other minority groups in political life;
- freedom from domination by the military, foreign powers, totalitarian parties, religious hierarchies, economic oligarchies, or any other powerful group in making personal political choices; and
- the openness, transparency, and accountability of the government to its constituents between elections; freedom from pervasive government corruption; government policies that reflect the will of the people.
Relationship to Growth & Poverty Reduction
Although the relationship between democracy and economic growth is complex, research suggests that the institutional structures of democracy can promote growth by increasing policy stability, cultivating higher rates of human capital accumulation, reducing levels of income inequality and corruption, and encouraging higher rates of investment. The links between political rights and poverty reduction are similarly complicated, but there is evidence that democratic institutions are better at reducing economic volatility and provide a more consistent approach to poverty reduction than do autocratic regimes. Research also links the incentive structure of democratic institutions with outcomes favorable for the poor.
A team of expert analysts and scholars evaluate countries on a 40-point scale – with 40 representing “most free” and 0 representing “least free.” The Political Rights indicator is based on a 10 question checklist grouped into the three subcategories: Electoral Process (3 questions), Political Pluralism and Participation (4 questions), and Functioning of Government (3 questions). Points are awarded to each question on a scale of 0 to 4, where 0 points represents the fewest rights and 4 represents the most rights. The highest number of points that can be awarded to the Political Rights checklist is 40 (or a total of up to 4 points for each of the 10 questions). The full list of questions included in Freedom House’s methodology may be found at: http://bit.ly/dRskoo
In consultation with Freedom House, MCC considers countries with scores above 17 to be passing this indicator.
 Rodrik, D. and Roman Wacziarg. 2005. Do Democratic Transitions Produce Bad Economic Outcomes? American Economic Review Papers and Proceedings 95(2): 50-55. Rodrik, Dani. 2000. Participatory Politics, Social Cooperation, and Economic Stability. American Economic Review Papers and Proceedings 90(2): 140-144. Rigobon, Roberto and Dani Rodrik 2005. Rule of Law, Democracy, Openness and Income: Estimating the Interrelationships. Economics of Transition 13(3): 533- 564. Helliwell, J. 1994. Empirical linkages between democracy and economic growth. British Journal of Political Science April 24(2): 225. Baum, Matthew A., and David A. Lake. 2003. The Political Economy of Growth: Democracy and Human Capital. American Journal of Political Science 47(2): 333-347. Wacziarg, R. and José Tavares. 2001. How Democracy Affects Growth. European Economic Review 45(8): 1341-1379. Lederman, Daniel, Norman Loayza, and Rodrigo Soares. 2005. Accountability and Corruption: Political Institutions Matter. Economics and Politics 17(1): 1-35. Clague, C., Keefer, P., Knack, S., and M. Olson. 1996. Property and contract rights in autocracies and democracies. Journal of Economic Growth 1(2): 243-276. Henisz, Witold J. 2000. The Institutional Environment for Economic Growth. Economics and Politics 12(1): 1-31. Zweifel, Thomas D., and Patricio Navia. 2000. Democracy, Dictatorship, and Infant Mortality. Journal of Democracy 11:99-114. Brown, David. 1999. Reading, Writing, and Regime Type: Democracy’s Impact on School Enrollment. Political Research Quarterly 52(4): 681-707. Stasavage, David. 2005. The Role of Democracy in Uganda's Move to Universal Primary Education. Journal of Modern African Studies 43(1): 53-73. Stasavage, David. 2005. Democracy and Education Spending in Africa. American Journal of Political Science 49(2): 343-358. Brown, David and Wendy Hunter. 2004. Democracy and Human Capital Formation: Education Spending in Latin America, 1980-1997. Comparative Political Studies 37(7): 842-864. Farzin, Y. Hossein, and Craig A. Bond. 2006. Democracy and environmental quality Journal of Development Economics 81(1): 213– 235. McGuire, J.W. 2006. Democracy, Basic Service Utilization, and Under-5 Mortality: A Cross-National Study of Developing States. World Development 34(3):405–25. Ahlquist, J.S. 2006. Economic policy, institutions, and capital flows: portfolio and direct investment flows in developing countries. International Studies Quarterly 50(3): 681-704. Jensen, Nathan. 2003. Democratic Governance and Multinational Corporations. International Organization 57(3): 587-616. Henisz, Witold J. 2000. The Institutional Environment for Multinational Investment Journal of Law, Economics and Organization 16 (2): 334-364. Tsebelis, George. 1995. Decision Making in Political Systems: Veto Players in Presidentialism, Parliamentarism, Multicameralism, and Mulitpartyism. British Journal of Political Science 25(3): 289–325. Henisz, Witold J. 2004. Political Institutions and Policy Volatility. Economics and Politics 16(1): 1-27. Rodrik, Dani. 1999. Where Did All the Growth Go? External Shocks, Social Conflict, and Growth Collapses Journal of Economic Growth 4(4): 385– 412. Rivera-Batiz, Francisco L. 2002. Democracy, Governance, and Economic Growth: Theory and Evidence. Review of Development Economics 6(2): 225-47. Besley, Tim, Torsten Persson, and Daniel Sturm. 2006. Political Competition and Economic Performance: Theory and Evidence from the United States. NBER Working Paper No. 11484.
 Varshney, Ashtosh. 2000. Why Have Poor Democracies Not Eliminated Poverty? A Suggestion. Asian Survey 40(5): 718-736. Persson, Torsten and Guido Tabellini. Democracy and Development: the Devil in the Details. NBER working paper 11993. January 2006. Halperin, Morton H, Joseph T. Seigle, and Michael M. Weinstein. 2005. The Democracy Advantage: How Democracies Promote Prosperity and Peace. New York: Routledge. Rodrik, D. and Roman Wacziarg. 2005. Do Democratic Transitions Produce Bad Economic Outcomes? American Economic Review Papers and Proceedings 95(2): 50-55. Quinn, Dennis, and John Woolley. 2001. Democracy and National Economic Performance: The Preference for Economic Stability. American Journal of Political Science 45(3). Jalan, Jyotsna, and Martin Ravallion. 1999. Are the Poor Less Well Insured: Evidence on Vulnerability to Income Risk in Rural China. Journal of Development Economics 58(1): 61-82.
 Bueno de Mesquita, Bruce, Alastair Smith, Randolph M. Siverson, and James D. Morrow. 2003. The
Logic of Political Survival. Cambridge, Mass.: MIT Press. Besley, Timothy and Robin Burgess. 2002. The Political Economy of Government Responsiveness: Theory and Evidence From India. Quarterly Journal of Economics. 117(4): 1415–451. Hirschman, Albert O. 1970. Exit, Voice, and Loyalty: Responses to Decline in Firms, Organizations, and States. Cambridge, Mass.: Harvard University Press. Paul, Samuel. 1992. Accountability in Public Services: Exit, Voice and Control. World Development 20(7): 1047-1060. There is also some empirical evidence linking democratic institutions to poverty reduction. See Li, H., Squire, L., and H. Zou. 1998. Explaining International and Intertemporal Variations in Income Inequality. Economic Journal 108: 26-43. Dollar, David and Aart Kraay. 2002. Growth is Good for the Poor. Journal of Economic Growth 7: 195-225. Arimah, Ben C. 2004. Poverty Reduction and Human Development in Africa. Journal of Human Development 5(3): 399-415. Kosack, S. 2003. Effective Aid: How Democracy Allows Development Aid to Improve the Quality of Life. World Development 31(1): 1-22.