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

Author

Listed:
  • Kaufmann, Daniel
  • Batra, Geeta
  • Stone, Andrew H. W.

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.

Suggested Citation

  • Kaufmann, Daniel & Batra, Geeta & Stone, Andrew H. W., 2003. "The Firms Speak: What the World Business Environment Survey Tells Us about Constraints on Private Sector Development," MPRA Paper 8213, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:8213
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    References listed on IDEAS

    as
    1. Simon Johnson & Daniel Kaufman & Andrei Shleifer, 1997. "The Unofficial Economy in Transition," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 28(2), pages 159-240.
    2. Mirjam Schiffer & Beatrice Weder, 2001. "Firm Size and the Business Environment : Worldwide Survey Results," World Bank Publications - Books, The World Bank Group, number 13988.
    3. Stone, Andrew H.W., 1992. "Listening to firms : how to use firm-level surveys to assess constraints on private sector development," Policy Research Working Paper Series 923, The World Bank.
    4. Edgardo Campos, J. & Lien, Donald & Pradhan, Sanjay, 1999. "The Impact of Corruption on Investment: Predictability Matters," World Development, Elsevier, vol. 27(6), pages 1059-1067, June.
    5. Zoido-Lobatón, Pablo & Johnson, Simon & Kaufmann, Daniel, 1998. "Corruption, public finances and the unofficial economy," Sede de la CEPAL en Santiago (Estudios e Investigaciones) 34372, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    6. Friedman, Eric & Johnson, Simon & Kaufmann, Daniel & Zoido-Lobaton, Pablo, 2000. "Dodging the grabbing hand: the determinants of unofficial activity in 69 countries," Journal of Public Economics, Elsevier, vol. 76(3), pages 459-493, June.
    7. Andrei Shleifer & Robert W. Vishny, 1994. "Politicians and Firms," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(4), pages 995-1025.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    JEL classification:

    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • P10 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - General
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics

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