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The Ease of Doing Business Index as a tool for investment location decisions

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  • Pinheiro-Alves, Ricardo
  • Zambujal-Oliveira, João

Abstract

The Ease of Doing Business Index is widely used by multinationals in their investment location decisions. Factor analysis and Chronbach’s alpha show its limited consistency and descriptive power of the business environment.

Suggested Citation

  • Pinheiro-Alves, Ricardo & Zambujal-Oliveira, João, 2012. "The Ease of Doing Business Index as a tool for investment location decisions," Economics Letters, Elsevier, vol. 117(1), pages 66-70.
    • Handle: RePEc:eee:ecolet:v:117:y:2012:i:1:p:66-70
    DOI: 10.1016/j.econlet.2012.04.026
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    2. Petróczy, Dóra Gréta, 2021. "An alternative quality of life ranking on the basis of remittances," Socio-Economic Planning Sciences, Elsevier, vol. 78(C).
    3. Bersan Haliti & Safet Merovci, 2020. "The Impact of the Investment Environment on Foreign Direct Investment (FDI) in the European Transition Economies," Economic Alternatives, University of National and World Economy, Sofia, Bulgaria, issue 1, pages 138-147, March.
    4. Jafari-Sadeghi, Vahid & Sukumar, Arun & Pagán-Castaño, Esther & Dana, Léo-Paul, 2021. "What drives women towards domestic vs international business venturing? An empirical analysis in emerging markets," Journal of Business Research, Elsevier, vol. 134(C), pages 647-660.
    5. Pal, Debdatta & Mitra, Subrata K. & Chatterjee, Somdeep, 2022. "Does “investment climate” affect GDP? Panel data evidence using reduced-form and stochastic frontier analysis," Journal of Business Research, Elsevier, vol. 138(C), pages 301-310.
    6. Brixiova Schwidrowski, Zuzana & Ncube, Mthuli, 2013. "Entrepreneurship and the Business Environment in Africa: An Application to Ethiopia," IZA Discussion Papers 7553, Institute of Labor Economics (IZA).
    7. Jafari-Sadeghi, Vahid & Garcia-Perez, Alexeis & Candelo, Elena & Couturier, Jerome, 2021. "Exploring the impact of digital transformation on technology entrepreneurship and technological market expansion: The role of technology readiness, exploration and exploitation," Journal of Business Research, Elsevier, vol. 124(C), pages 100-111.
    8. Qian, Xinbei & Huang, Liangxiong & Wang, Xianbin & Wang, Shuqi, 2022. "Detecting pivotal countries of China's OFDI in the “Belt and Road” initiative: The perspective of similarity of doing business," International Review of Economics & Finance, Elsevier, vol. 77(C), pages 296-311.
    9. Cull, Robert & Navajas, Sergio & Nishida, Ippei & Zeiler, Renate, 2015. "A New Index of the Business Environment for Microfinance," World Development, Elsevier, vol. 70(C), pages 357-388.
    10. Gabriela Chmelikova & Renata Kucerova & Helena Chladkova & Jindrich Spicka, 2024. "The dark side of economic success: ESG crime rate of European countries is driven by the conditions for doing business," MENDELU Working Papers in Business and Economics 2024-97, Mendel University in Brno, Faculty of Business and Economics.
    11. Patrícia Bernardes & Petr Iakovlevitch Ekel & Sérgio Fernando Loureiro Rezende & Joel Gomes Pereira Júnior & Angélica Cidália Gouveia Santos & Maurício Andrade Rodrigues Costa & Rafael Lopes Carvalhai, 2022. "Cost of doing business index in Latin America," Quality & Quantity: International Journal of Methodology, Springer, vol. 56(4), pages 2233-2252, August.
    12. Jafari-Sadeghi, Vahid, 2020. "The motivational factors of business venturing: Opportunity versus necessity? A gendered perspective on European countries," Journal of Business Research, Elsevier, vol. 113(C), pages 279-289.
    13. Estevão, João & Lopes, José Dias & Penela, Daniela & Soares, José Miguel, 2020. "The Doing Business ranking and the GDP. A qualitative study," Journal of Business Research, Elsevier, vol. 115(C), pages 435-442.
    14. Matheus Pereira Libório & Lívia Maria Leite Silva & Petr Iakovlevitch Ekel & Letícia Ribeiro Figueiredo & Patrícia Bernardes, 2022. "Consensus-Based Sub-Indicator Weighting Approach: Constructing Composite Indicators Compatible with Expert Opinion," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 164(3), pages 1073-1099, December.
    15. Carmen Comăniciu, 2019. "Is There a Correlation Between the Ease of Doing Business Index and the Haven Score?," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(2), pages 686-694, December.
    16. Ms. Deniz O Igan & Ali Mirzaei & Tomoe Moore, 2018. "How Do Regulations of Entry and Credit Access Relate to Industry Competition? International Evidence," IMF Working Papers 2018/084, International Monetary Fund.
    17. Rogge, Nicky & Archer, Geoffrey, 2021. "Measuring and analyzing country change in establishing ease of doing business using a revised version of World Bank's ease of doing business index," European Journal of Operational Research, Elsevier, vol. 290(1), pages 373-385.
    18. Shengbing He & Huilin Yao & Zhou Ji, 2021. "Direct and Indirect Effects of Business Environment on BRI Countries’ Global Value Chain Upgrading," IJERPH, MDPI, vol. 18(23), pages 1-16, November.
    19. Christoph Morosoli & Peter Draper & Andreas Freytag & Sebastian Schuhmann, 2024. "Drivers of Inclusive Development: An Empirical Investigation," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 36(4), pages 987-1015, August.
    20. Chao, Chi-Chur & Ee, Mong Shan, 2024. "Does unionization reduce wage inequality? New evidence from business dynamism," International Review of Economics & Finance, Elsevier, vol. 92(C), pages 690-703.
    21. Valentina Diana RUSU & Angela ROMAN, 2016. "The Business Environment In Cee Countries: Current Challenges And Perspectives," CES Working Papers, Centre for European Studies, Alexandru Ioan Cuza University, vol. 8(1), pages 128-147, March.
    22. Karama, Dalal, 2014. "Ease of Doing Business: Emphasis on Corruption and Rule of Law," MPRA Paper 58662, University Library of Munich, Germany.
    23. Vahid Jafari-Sadeghi & Jean-Marie Nkongolo-Bakenda & Léo-Paul Dana & Robert B. Anderson & Paolo Pietro Biancone, 2020. "Home Country Institutional Context and Entrepreneurial Internationalization: The Significance of Human Capital Attributes," Journal of International Entrepreneurship, Springer, vol. 18(2), pages 165-195, June.

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    More about this item

    Keywords

    Factor analysis; Alpha of Chronbach; Business environment; FDI;
    All these keywords.

    JEL classification:

    • C38 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Classification Methdos; Cluster Analysis; Principal Components; Factor Analysis
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements

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