Yet policy debates continue to be permeated by the “illusion of certainty”.1 The reluctance to give adequate prominence to risks may reflect the fact that many of us feel uncomfortable with formal statements of probabilities. Probability theory is relatively recent in our intellectual history, dating back to a flowering of ideas around 1660 from Pascal, Leibniz, Huygens and others.2 Despite advances since then, statistical thinking remains prone to confusion and is often avoided. Television weather forecasts in Britain rarely employ the language of probabilities used by the meteorologists themselves. Professor Gigerenzer of the Max Planck Institute in Berlin has demonstrated in a series of studies how poorly doctors, lawyers, and other professionals understand probabilities. And despite Seneca’s maxim that “luck never made a man wise”, airport bookshops stock titles on how to become rich by successful investors and entrepreneurs who are confident that their success is the result of outstanding business acumen rather than good fortune. Many of these misunderstandings stem from a failure to grasp basic statistical concepts. Juries are not informed that, in a country of our size, multiple cot deaths are likely to occur several times a year, that several people will have DNA that matches the incriminating sample, and that in themselves these  1  To use the phrase of Professor Gerd Gigerenzer who has done more than anyone to draw attention to the lack of public understanding of risk. 2  For an intellectual history of probability theory see Hacking (1975) and Bernstein (1996).

The case of some Asian countries, whose governance record is a far cry from the accepted blue print, but have posted impressive and sustained growth, has been cited as part of the contrary evidence. Against this background, it is proposed that further research is needed to provide a definitive position on the matter. The possibility is expressed that though governance and poverty reduction may be correlated, the direction of causation may not be so clear. Further, it is claimed that governance is a multi-dimensional concept and provides an avenue for intrusion into virtually every aspect of state functioning. It thus essentially compromises sovereignty in decision-making, and transfers accountability of government from its own citizens to the donor community. Given the imprecision of the meaning and instability of the concept, approaches to its measurement run into difficulties and yield results of doubtful validity and reliability. Yet these measurements have become the basis for further conditionality in aid distribution and the introduction of selectivity in determining aid recipients. With the wide-spread inclusion of governance criteria in aid conditionality, there is a measure of stress imposed on recipient countries, which generally lack the capacity to pursue the wide range of reforms required, the urgency of some of which have been called into question by some informed observers. Some critics see a more sinister dimension in the governance discourse, claiming that the whole purpose of the approach is to create in the developing countries the state-market relationships typical of Western neo-liberal systems.