12 Years of Doing Business and countingDominik Wanner

When the World Bank started to work on the first Doing Business Report （DBR） back in 2003 they presumably did not expect that it will become of the most influential， but also most controversial international business rankings in the world. For the first time the legal systems of jurisdictions worldwide would be analysed and such data later on statistically as well as mathematically processed to produce worldwide doing business rankings. This was an ambitious project as part of the relatively new discipline of Law and Economics. The results of DBR would make economies and their legal system around the world comparable. And this would put the World Bank also into the position to push for economic and business legal reforms in countries or economies that would underperform. It became an important tool of the World Bank. Therefore it is very important to have a close eye on DBR and its development.

When DBR was published for the first time in 2004 it looked quite different from DBR we can read in 2015. But the foundation for all that was laid about 15 years ago. It started with only five different factors that have been analysed： Starting a Business， Hiring and Firing Workers， Enforcing Contracts， Getting Credit， and Closing a Business. Three of them survived until today， Starting a Business， Enforcing Contracts， and Getting Credit. Hiring and Firing Workers became by far the most controversial one. Labour Unions， academia， as well as governments complaint about it as it was encouraging to have very flexible labour laws leaving workers with not much protection. Therefore this DBR factor first got renamed into Employing Workers， but then finally did not survive as an official DBR factor. But the World Bank still evaluates it and keeps it as an unofficial annex factors in its published statistics. It did not want to give it up as they set up the structure for the necessary data collection and data processing. And they do not want to loose this tool when it becomes necessary to suggest economic reform measures to various countries. Closing a Business is still around as an official DBR factor， but it got redesigned as is now called Resolving Insolvency. As the World Bank has been continuously updating and redesigning the methodology of almost all DBR factors the collection and processing of DBR data has been adapted and changed during the more than twelve years of existence quite significantly.

Also new factors have been added over time. So already in the second edition two more factors have been evaluated：Registering Property and Protecting Investors. Adding factors involves a immense amount of work and preparation. Therefor adding two of them is very remarkable and both of them still exist today. And again one year later even three more factors have been added： Dealing with Licences， Paying Taxes， and Trading across Boarders. And again one of them became politically tremendously controversial. The evaluation of Paying Taxes preferred tax regimes that have been very much favouring low tax burden for corporations. Therefore it was seen and is seen by many as an invitation for a ‘race to the bottom’ by setting up a completion between jurisdiction to offer the lowest corporate tax rates to score high in this DBR category. Of course these critics are not absolutely wrong. But as Doing Business Report is a clear part of the Washington Consensus and promotes its economic ideas heavily one should not be surprised. You have to know whom you are dealing with when you read DBR and when you try to work on your position in DBR rankings.

In 2012 and 2013 again changes have been made to the DBR factor composition： the factor Dealing with licences got redesigned and also renamed as part of this redesign to Dealing with construction permits. Additionally the factor Getting Electricity was introduced as a consequence of a World Bank board resolution. They wanted to include a factor representing the infrastructure level of a jurisdiction and decided that Getting Electricity would show this best as part of DBR. Additionally Employing Workers was taken out of the official factors that made it again ten official DBR factors in total.

Finally in 2015 the factor Protecting Investors was changed slightly into Protecting （Minority） Investors. This change looks like a concession to the critics of the Washington Consensus approach of DBR to show its good will not only to focus on the big corporations and supporting their positions worldwide to get as much as possible of free access to markets， cheap labour， low taxes， and high speed of administrative support. This time the World Bank wanted to show that it is also caring about the minority investors and put a focus on them when evaluating this factor. For 2016 there are again new factors in the pipeline： Legal System will be one of them. This would bring DBR back to its roots as it started as a business ranking as a product of the research discipline of Law and Economics. To include the analysis of the legal system of all 189 evaluated economies it therefore only a natural next step.