Does global competition motivate states to press ahead with public-administration reform?
There is indeed competition between countries. On average, states which have reformed their bureaucracy by introducing clear rules and transparency, and thus made it easy for businesses to operate, generate higher incomes. The IFC has been publishing “Doing Business” reports since 2003, assessing national investment climates. Can you deduce a desirable sequence of reforms from this wealth of knowledge? There is no magic formula for success. In each case you have to think about what is possible, and what makes political sense under the given circumstances. Sound property rights are essential. But are they needed from the outset? In some countries where the people have no confidence in the government, this may be so. But China is an example of how things can also work differently. China’s fundamental private-property law only came into effect last year. For years, however, business people had been acting as if such a law already existed – because the government itself had credibly estab
