After “Doing Business”

and public order, a skilled workforce, or investments in research and development.

Finally, there is the question of data credibility. Greater transparency would be a good start. The raw data underlying the Doing Business report were never publicly available, so the analysis could not be independently replicated. Excessive focus on rankings and lack of access to the data resulted in a product that was vulnerable to political pressures and data haggling.

But transparency rules can never ensure against deliberate manipulation. Ultimately, the World Bank will have to convince data users that it has built a functional firewall between its analytical work and its lending operations. To that end, the Bank should abandon the practice of selling advisory services on how to improve outcomes in the statistics it directly measures.

The demise of Doing Business presents the World Bank with an opportunity to reclaim its intellectual leadership in global development through a renewed commitment to collecting and analyzing credible data. Arguing that the scandal was unfortunate but that the methodology was right won’t cut it. The Doing Business rankings – that result from the aggregation of indexes – were always dubious, because they did not provide an accurate picture of conditions on the ground and left no place for crucial public investments, sensible taxes, or necessary regulations. Any future effort to assess the business environment in member countries must address these shortcomings.

This commentary is also signed by the other members of the External Review Panel for Doing Business: Laura Alfaro, Alan J. Auerbach, Takatoshi Ito, Şebnem Kalemli-Özcan, and Justin Sandefur.

Project