Exploring the institutional determinants of risk governance: A comparative approach across nations

The ability of risk governance greatly influences the results when countries face risks. A country with improved risk governance can avoid or minimize disaster loss. This paper explores different institutional governance factors that affect risk governance across countries, and the results can guide the governments to improve their capabilities in the fight against risks. We classified the institutional governance traits of a country into four distinct dimensions. These dimensions are: democracy, economic freedom, government effectiveness, and corruption. We find that government effectiveness constitutes the leading effect on risk governance, whereas the control of corruption and economic freedom play a secondary supporting role. Bootstrap mediation analysis showed that economic freedom can help improve the performance of an economy, thereby indirectly enhancing the ability of risk governance. Although the effect of democracy plays a negative role, we should keep in mind that both centralized national control and democratic local institutions are necessary for successful risk governance, and an integrated risk management system with diverse risk strategies may be the optimal solution.