The median quality grade is a “B”. Nearly 65% of write-ups covered one half or more of the criteria (i.e. received a grade of either “A” or “B”), but only 19% received an “A” grade. Only 5.5% of write-ups received a grade of “D”, for addressing less than 15% of the relevant criteria. As discussed below, however, there is substantial variation across regions in quality grades.

Three other dependent variables in the analysis are constructed from the network review outputs and finalized CPIA ratings. First, we code each country-question observation for whether or not at least one network reviewer _requests more information_ from the regions; such requests typically reflect a perception that the write-up is inadequate in one or more respects for making a confident assessment of the proposed rating. Second, we code for whether or not at least one network reviewer _disagrees_ with the proposed rating and recommends a different rating. Third, we code for ratings adjustments, or cases where the final “official” rating differs from the one originally proposed by the regions.

# _IDA countries_

The CPIA ratings are produced for purposes of allocating IDA funds. However, the CPIA assessments are conducted for IBRD-eligible countries as well as for IDA-eligible countries. Ratings are publicly disclosed only for the IDA countries (and only beginning in 2005). Intuitively, one would expect staff to devote extra effort to the CPIA assessments for the IDA countries, because more is at stake, and because their ratings (if not the write-ups) are publicly released so potentially subject to wider scrutiny and criticism. We therefore hypothesize that write-ups will be longer and cover more of the question criteria for IDA than for IBRD countries. If this increased effort produces more accurate and well-justified ratings, then network reviewers – other things equal – should disagree less often with the regions’ proposals for IDA countries, and request additional information less often. Other things may not be equal, however. Network reviewers in turn may devote more attention to IDA country ratings, because of their importance for allocations and because they are public. Moreover, network reviewers may scrutinize IDA country ratings more closely, recognizing a certain degree of moral hazard inherent in the process.

Although the expert judgment of Bank staff is clearly an asset in the CPIA exercise, at the same time there is a potential conflict of interest in having staff provide ratings, particularly for IDA countries. This potential for conflict of interest arises from the fact that ratings produced by staff are in turn used for allocating IDA resources for the same countries on which the work programs of those staff depend. Therefore, staff may potentially be upwardly biased in assigning ratings for their countries. (IEG, 2010: 50) This reasoning suggests that any extra effort devoted to IDA ratings by country teams may not necessarily improve the accuracy of scores. Accordingly, network reviewers might disagree more often with IDA than with non-IDA ratings even if the write-ups for the former are lengthier and cover the criteria in the questions more completely. Most notably, the moral hazard issue introduces a strong asymmetry into the network reviews; it implies that a majority of disagreements will take the form of network reviewers recommending a rating lower than the one proposed by the region.

8