Measuring what matters for business: The new B-READY data in the World Development Indicators

What makes a country a great place to start and grow a business?

Among low-income economies across the world, only 29% have a single centralized website dedicated to providing regulatory information pertaining to international trade. In high-income economies, the same number stands at 67% .

The World Bank’s new Business Ready (B-READY) project shines a light on this imbalance, and offers a comprehensive, detailed look at the regulations, implementation and service delivery that impact an economy’s private sector.

What B-READY measures

B-READY is a new data collection and analysis initiative by the World Bank that evaluates the global business and investment climate. B-READY offers a detailed dataset and framework to identify the factors which enable private sector development and looks beyond firm-level outcomes to consider the well-being of workers, consumers, and the environment.

The project integrates both de jure (law and regulations) and de facto (actual practice) measures, providing data that are both cross-country comparable and relevant within a national context.

B-READY is structured around ten topics which follow the life cycle of a firm, from opening, operating and expanding, to and closing (or reorganizing): Business Entry, Business Location, Utility Services, Labor, Financial Services, International Trade, Taxation, Dispute Resolution, Market Competition, and Business Insolvency.

Each of the ten topics is evaluated along three pillars which capture key aspects of way countries support the private sector:

·       Pillar 1: Regulatory framework: Evaluates the rules and regulations firms must navigate when entering, operating, and exiting the market.

·       Pillar 2: Public services: Assesses government-provided services that support regulatory compliance, including institutions and infrastructure that enable business activity.

·       Pillar 3: Operational efficiency: Measures the ease and effectiveness with which firms interact with regulations and public services.

The project scores each economy on the three pillars, ten topics, and thirty pillar-topic combinations. These scores range from 0 (worst) to 100 (best).

New data in the World Development Indicators

In April of this year, 43 new indicators drawing on the B-READY project were added to the World Development Indicators (WDI) database:

Economy scores for each of the 3 pillars

These scores reflect the average of an economy’s pillar scores across the ten B-READY topics.

Economies like Hungary, Estonia, and Singapore achieve the highest scores for Pillar I (Regulatory Framework), Pillar II (Public Services), and Pillar III (Operational Efficiency), respectively.

Economy scores for each of the 10 topics

These scores are obtained by averaging the three pillar scores under each topic.

Best performing economies include for example Greece for the ease of starting a business (Business Entry), the Slovak Republic for providing high-quality, reliable, and accessible utilities (Utility Services), Georgia for strong labor regulations (Labor), or Rwanda for an efficient system for solving commercial disputes (Dispute Resolution).

Topic-specific pillar scores for each economy

Scores for each of the three pillars are calculated for every topic.

Take for example the International Trade topic. Pillar I measures the quality of regulations for international trade, Pillar II assesses digital and physical infrastructure concerning international trade and the quality of border management, and Pillar III measures the time and cost to comply with export and import requirements, participation in cross-border digital trade, as well as the perceived major obstacles for international trade.

Each pillar is divided into categories—defined by common features that inform the grouping into a particular category—and each category is further divided into subcategories. Each subcategory has several indicators, each of which may, in turn, have several components.

Scores are assigned to each indicator and subsequently aggregated to obtain the scores for each subcategory, category, and pillar. The three pillar scores under a topic are averaged to derive the overall topic score.

Currently, the B-READY data are available for 50 economies, with more countries planned to be added in 2025 and 2026.

Source : World Bank