The electron correlation effects covered by density functional theory (DFT)
can be assessed qualitatively by comparing DFT densities rho (r) with suit
able reference densities obtained with wavefunction theory (WFT) methods th
at cover typical electron correlation effects. The analysis of difference d
ensities rho (DFT)-rho (WFT) reveals that LDA and GGA exchange (X) function
als mimic non-dynamic correlation effects in an unspecified way. It is show
n that these long range correlation effects are caused by the self-interact
ion error (SIE) of standard X functionals. Self-interaction corrected (SIC)
DFT exchange gives, similar to exact exchange, for the bonding region a de
localized exchange hole, and does not cover any correlation effects. Hence,
the exchange SIE is responsible for the fact that DFT densities often rese
mble MP4 or MP2 densities. The correlation functional changes X-only DFT de
nsities in a manner observed when higher order coupling effects between low
er order N-electron correlation effects are included. Hybrid functionals le
ad to changes in the density similar to those caused by SIC-DFT, which simp
ly reflects the fact that hybrid functionals ave been developed to cover pa
rt of the SIE and its long range correlation effects in a balanced manner.
In the case of spin-unrestricted DFT (UDFT), non-dynamic electron correlati
on effects enter the calculation both via the X functional and via the wave
function, which may cause a double-counting of correlation effects. The use
of UDFT in the form of permuted orbital and broken-symmetry DFT (PO-UDFT,
BS-UDFT) can lead to reasonable descriptions of multireference systems prov
ided certain conditions are fulfilled. More reliable, however, is a combina
tion of DFT and WFT methods, which makes the routine description of multire
ference systems possible. The development of such methods implies a separat
ion of dynamic and non-dynamic correlation effects. Strategies for accompli
shing this goal are discussed in general and tested in practice for CAS (co
mplete active space)-DFT.