How have potential ideological biases in poll agencies ratings been addressed?
We address this issue as follows. Our identifying assumption is that surveys of firms or individuals are not tainted by ideology, since they reflect the views of a large number of respondents in each country. In contrast, it is possible that the views of a smaller number of raters affiliated with a particular institution may reflect the ideology of that group. We can therefore identify the effects of ideology by looking at the correlation across countries between the ideology of the government in power, and the difference in the percentile ranks assigned to countries by a poll of experts and a survey of individuals and firms. We implement this idea using the World Bank’s Business Environment Survey for 2000, and an indicator variable that takes on the value 1 if the government in power is left-of-center, 2 if it is center, and 3 if it is right-of-center, taken from the database of political institutions constructed by Beck et. al. (2001). The coefficient on the ideology variable will t
