Beware of Rankings! Or Should Ukraine’s Labour Reforms be Justified by Scores in International Composite Indicators
Rankings and comparisons based on international composite indicators have become extremely popular. However, if poorly constructed or misinterpreted, they can send misleading policy messages. This post examines methodological pitfalls in three renowned composite indicators of labour market regulations, and in rankings based on them. It argues that justifying reforms with the aim of improving Ukraine’s position in aggregate rankings should be done with great caution, and best simply avoided.