Analysis of the Prosperity Index and the construction of a Regional Prosperity Index for the Czech Republic

This bachelor's thesis focuses on the analysis of the methodology used to construct the global Prosperity Index published by the Legatum Institute and on the creation of a regional-level Prosperity Index for the Czech Republic. The thesis aims to evaluate the data quality and methodological procedures used in the global index and, based on this assessment, to develop a composite index that reflects differences in prosperity across Czech regions. The construction of the regional index follows OECD guidelines for building composite indicators, including indicator selection, suitability testing, standardisation using z-scores, equal weighting, and linear aggregation. The analysis reveals that, despite its broad thematic scope, the global index suffers from limited transparency, unavailability of original data, and methodological ambiguity, constraining its reproducibility and analytical value. The resulting regional index highlights significant disparities: the capital city of Prague ranks as the most prosperous region, while the Ústí nad Labem Region ranks last. Sensitivity analysis confirms the robustness of the results. The thesis also points out data availability constraints and methodological challenges associated with composite index construction.