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The Firms Speak: What the World Business Environment Survey Tells Us about Constraints on Private Sector Development

25 Pages Posted: 11 May 2004  

Geeta Batra

affiliation not provided to SSRN

Daniel Kaufmann

Natural Resource Governance Institute (NRGI); The Brookings Institution

Andrew H. W. Stone

World Bank - Private Sector Advisory Services Department

Date Written: October 2003

Abstract

This chapter summarizes the salient results of the World Business Environment Survey (WBES). It shows that important dimensions of the climate for business operation and investment can be measured, analyzed, and compared across countries, and that governance is key to the business environment and investment climate. The survey findings suggest that key policy, institutional, and governance indicators affect the growth of a firm's sales and investment and the extent to which firms operate in the unofficial economy. Further, the paper provides empirical support for some commonly held notions, while challenging others. It suggests a link between taxation, financing, and corruption on the one hand, and growth and investment on the other, and it highlights the costs to economies where the state is captured by a narrow set of private interests.

Keywords: Business Environment , Survey, Business Constraints, Private Sector Development, Investment Climate, Governance, Corruption, Capture

JEL Classification: K42, L20, L51, M13, M21, O10, P10

Suggested Citation

Batra, Geeta and Kaufmann, Daniel and Stone, Andrew H. W., The Firms Speak: What the World Business Environment Survey Tells Us about Constraints on Private Sector Development (October 2003). Available at SSRN: https://ssrn.com/abstract=541388 or http://dx.doi.org/10.2139/ssrn.541388

Geeta Batra

affiliation not provided to SSRN

Daniel Kaufmann (Contact Author)

Natural Resource Governance Institute (NRGI) ( email )

80 Broad Street
New York, NY 10004
United States

HOME PAGE: http://www.resourcegovernance.org

The Brookings Institution ( email )

1775 Massachusetts Avenue, NW
Washington, DC 20036
United States

HOME PAGE: http://www.brookings.edu/experts/kaufmannd

Andrew H. W. Stone

World Bank - Private Sector Advisory Services Department ( email )

Washington, DC 20433
United States

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