{"id":244336,"date":"2023-05-25T20:42:30","date_gmt":"2023-05-25T15:12:30","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=244336"},"modified":"2023-05-25T20:42:30","modified_gmt":"2023-05-25T15:12:30","slug":"why-improving-on-world-banks-ease-of-doing-business-rankings-might-have-hurt-economies","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/why-improving-on-world-banks-ease-of-doing-business-rankings-might-have-hurt-economies\/","title":{"rendered":"Why improving on World Bank\u2019s Ease of Doing Business rankings might have hurt economies"},"content":{"rendered":"\n

Source<\/strong>: The post is based on the article\u00a0\u201cWhy improving on World Bank\u2019s Ease of Doing Business rankings might have hurt economies<\/strong>\u201d published in The Indian Express <\/strong>on\u00a025th<\/sup> May 2023<\/strong>.<\/p>\n

Syllabus: GS 2 \u2013 <\/strong>Important International Institutions<\/strong><\/p>\n

Relevance: <\/strong>concerns with the World Bank\u2019s Ease of Doing Business Index<\/p>\n

News<\/strong>: The article explains the controversies and concerns associated with the World Bank\u2019s Ease of Doing Business Report.<\/p>\n

About World Bank\u2019s Ease of Doing Business Index<\/strong><\/p>\n

Click here to Read<\/strong><\/a><\/p>\n

What were the controversies with the World Bank\u2019s Ease of Doing Business (EoDB) Index?<\/strong><\/h2>\n

It was originally assumed that the ranking was based on many academic papers that studied these rankings and the economic performance of countries around the world.<\/p>\n

It was also assumed that the improvements in Doing Business had a positive impact on the GDP of a country.<\/p>\n

However, these rankings did not accurately reflect the reality in many nations and could be easily manipulated by governments<\/strong>.<\/p>\n

For instance,<\/strong> India\u2019s rankings were based on data from just two cities \u2014 Mumbai and Delhi. However, the situation of EoDB in the nearby cities was somewhat different.<\/p>\n

Further, India ranks shot up among the top 50 in the World Bank\u2019s EoDB\u00a0rankings in 2018.\u00a0The jump was despite the fact that India\u2019s GDP growth was suffering a sharp slowdown, leading to record unemployment.<\/p>\n

These all issues raised concerns over WB\u2019s EoDB.<\/p>\n

Read More: <\/strong>The end of Ease of Doing Business Rankings: Reasons and implications – Explained<\/strong><\/a><\/p>\n

What were other concerns with WB\u2019s EoDB?<\/strong><\/h2>\n

A research paper found that the improvements in the EoDB rankings had a negative impact on a nation’s GDP<\/strong>. This was contrary to the earlier assumption which thought an improvement in the rankings would boost GDP.<\/p>\n

A negative impact on a nation’s GDP was due to the fact that developing countries had more focus on the Doing Business score rather than implementing substantial reforms for their economy.<\/p>\n

Further, most of the earlier research looked at rankings instead of the country\u2019s scores on which these rankings were based<\/strong>.<\/p>\n

However, the ranks did not accurately capture the improvement in the economy because <\/strong>ranks are relative and a country could rise or fall sharply despite not having improved as much, or at all.<\/p>\n

For example, <\/strong>New Zealand was ranked first for ease of doing business in the 2020 report with a score of 87.01. If New Zealand\u2019s score had fallen by 5, its rank would have dropped by 9 places.<\/p>\n

In contrast, Sri Lanka was ranked 99th with a score of 61.8. If Sri Lanka\u2019s score had fallen by 5, its rank would have dropped 26 places.<\/p>\n

Hence, there were many problems with WB\u2019s EoDB index. Due to which, it was suspended by the World Bank.<\/p>\n","protected":false},"excerpt":{"rendered":"

Source: The post is based on the article\u00a0\u201cWhy improving on World Bank\u2019s Ease of Doing Business rankings might have hurt economies\u201d published in The Indian Express on\u00a025th May 2023. Syllabus: GS 2 \u2013 Important International Institutions Relevance: concerns with the World Bank\u2019s Ease of Doing Business Index News: The article explains the controversies and concerns… Continue reading Why improving on World Bank\u2019s Ease of Doing Business rankings might have hurt economies<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[212,10500],"class_list":["post-244336","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-gs-paper-2","tag-indian-express","entry"],"jetpack_featured_media_url":"","views":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/244336","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=244336"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/244336\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=244336"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=244336"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=244336"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}