The Power of Ranking: The Ease of Doing Business Indicator and Global Regulatory Behavior

51 Pages Posted: 22 Jan 2019

See all articles by Rush Doshi

Rush Doshi

Brookings Institution

Judith G. Kelley

Duke University - Trinity College of Arts & Sciences

Beth A. Simmons

University of Pennsylvania

Date Written: January 12, 2019

Abstract

The proliferation of Global Performance Indicators (GPIs), especially those that rate and rank states against one another, shapes decisions of states, investors, bureaucrats, and voters. This power has not been lost on the World Bank, which has marshaled the Ease of Doing Business (EDB) index to amass surprising influence over global regulatory policies – a domain over which it has no explicit mandate and for which there is ideological contestation. This paper demonstrates how the World Bank’s EDB ranking system affects policy through bureaucratic, transnational, and domestic political channels. We use observational and experimental data to show that states respond to being publicly ranked and make reforms strategically to improve their ranking. A survey experiment of professional investors demonstrates that the EDB ranking shapes investor perceptions of investment opportunities. Qualitative evidence from India’s interagency EDB effort show how these mechanisms shape domestic politics and policy in the world’s second-largest largest emerging economy.

Keywords: International domestic policy competition, deregulatory ranking system, Global Performance Indicators, GPIs, comparative information, influence of ranking, World Bank motives, EDB database & market share & criticisms, bureaucratic restructuring, policy reforms, impact of publicity, modern India

Suggested Citation

Doshi, Rush and Kelley, Judith Green and Simmons, Beth A., The Power of Ranking: The Ease of Doing Business Indicator and Global Regulatory Behavior (January 12, 2019). International Organization, Forthcoming; U of Penn Law School, Public Law Research Paper No. 19-05. Available at SSRN: https://ssrn.com/abstract=3318360

Rush Doshi

Brookings Institution ( email )

1775 Massachusetts Ave, NW
Washington, DC 20036
United States

Judith Green Kelley

Duke University - Trinity College of Arts & Sciences ( email )

Durham, NC 27708-0204
United States

Beth A. Simmons (Contact Author)

University of Pennsylvania ( email )

3501Sansom
Philadelphia, PA 19104
United States
7817990076 (Phone)

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