Democracy continued to decline in 2021, according to The Economist group's annual Democracy Index.
Two large European nations received criticism in the study.
Spain was downgraded to a "flawed democracy" due to a reduced score for judicial independence based on political disputes over the appointment of judges.
Britain meanwhile remains a "full democracy" but slipped in the ranking due to several scandals that had undermined confidence in the government, the report noted.
British Prime Minister Boris Johnson has faced weeks of criticism domestically because of the "partygate" affair.
Norway remains at the top of the ranking, with the study giving the Scandinavian country best marks in three of five categories.
Next came New Zealand, which climbed from fourth to second place, followed by Sweden, Finland, Iceland and Denmark.
Democracy in decline
Last year, 45.7 per cent of the world's population lived in some form of democracy, a drop from 49.4 per cent in 2020, the Economist Intelligence Unit said Wednesday.
Only 6.4 per cent live in a "full democracy," a decline from 8.4 per cent the previous year.
More than a third of people (37.1 per cent) meanwhile live under dictatorships. This marked a slight increase on 2020.
The proportion of authoritarian states has risen steadily in recent years.
China, an 'authoritarian regime'
China was the focus of the report, titled the 'The China Challenge.'
The study noted that contrary to the expectations of Western analysts, China has not become more democratic as it becomes richer. Rather it has become "less free" and is classified as an "authoritarian regime" in the report.
Rights activists say there is increasing surveillance in the country, repression against government critics, dissidents and minorities such as the Muslim Uighur population.
