Pitfalls to Avoid when Measuring Institutions: Is 'Doing Business' Damaging Business?

Over recent years, both governments and international aid organizations have been devoting large amounts of resources to "simplifying" the procedures for setting up and formalizing firms. Many of these actions have focused on reducing the initial costs of setting up the firm, disregarding the more important role of business registers as a source of reliable information for judges, government departments and, above all, other firms. This reliable information is essential for reducing transaction costs in future dealings with all sorts of economic agents, both public and private. The priorities of reform policies should therefore be thoroughly reviewed, stressing the value of the legal institutions rather than trivializing them as is often the case.

How Doing Business Jeopardizes Institutional Reform

Simplifying business formalization and eliminating outdated formalities is often a good way of improving the institutional environment for firms. Unfortunately, the World Bank's Doing Business project is harming such policies by promoting a reform agenda that gives them priority even in countries lacking functional business registers, so that the reformed registers keep producing valueless information, but faster. Its methodology also promotes biased measurements that impede proper consideration of the essential tradeoffs in the design of formalization institutions. If Doing Business is to stop jeopardizing its true objectives and contribute positively to scientific progress, institutional reform and economic development, then its aims, governance and methodology need to change.

Pitfalls to avoid when measuring institutions: Is "Doing Business" damaging business?

Over recent years, both governments and international aid organizations have been devoting large amounts of resources to simplifying the procedures for setting up and formalizing firms. Many of these actions have focused on reducing the initial costs of setting up the firm, disregarding the more important role of business registers as a source of reliable information for judges, government departments and, above all, other firms. This reliable information is essential for reducing transaction costs in future dealings with all sorts of economic agents, both public and private. The priorities of reform policies should therefore be thoroughly reviewed, stressing the value of the legal institutions rather than trivializing them as is often the case.

How "Doing Business" jeopardizes institutional reform

Simplifying business formalization and eliminating outdated formalities is often a good way of improving the institutional environment for firms. Unfortunately, the World Bank s "Doing Business" project is harming such policies by promoting a reform agenda that gives them priority even in countries lacking functional business registers, so that the reformed registers keep producing valueless information, but faster. Its methodology also promotes biased measurements that impede proper consideration of the essential tradeoffs in the design of formalization institutions. If "Doing Business" is to stop jeopardizing its true objectives and contribute positively to scientific progress, institutional reform and economic development, then its aims, governance and methodology need to change.

European Union Eastern Enlargement - Expectations and Experiences of Doing Business in the New Member States

This publication deals with various aspects of European Union enlargement effects faced by the companies from EU15 and especially from Finland when doing business in the ten transitional economies which joined European Union in 2004 and 2007

The Impact of Doing Business Regulations on Investments in ICT

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Challenges for Finnish companies in doing business in Russia

The purpose of this study was to define the key challenges for Finnish companies in doing business in Russia. The study consists of a theoretical and an empirical part and is conducted as a quantitative study. The theoretical framework was build around capital structure, cost of capital and emerging market theories. The findings suggest that the firms in the sample seek growth mainly from emerging markets. These research results also indicate that challenges are visible in emerging market environment. Challenges that companies are facing in Russian market are mainly connected with legislation, communication and language problems. In addition, companies’ profitability has changed during the financial crisis, which has been the main reason for the negative changes in companies’ profitability. Even though the financial crisis has had a strong effect on the worldwide economy, the firms in the sample are not postponing their investments to Russia, because of lack of new financing or unfavorable credit terms.

Resultados de informe Doing Business 2010,septiembre de 2009

Gestión del conocimiento

Resultados del informe Doing Business 2009

Gestión del conocimiento

Resultados de informe Doing Business 2009,septiembre de 2008

Gestión del conocimiento