Cultural pattern in economies: A study of similar ranking countries in the ease of doing business index

Abstract

In a paper published in 2002, Kevin O'Rourke and Jeffrey argued that in real sense globalization began in the 19th Century, when a sudden decrease in transport costs allowed the prices of commodities in Europe and Asia to converge. Since then it strengthened day by day and now the world has developed into what we call a ‘Global Village'. The concept of ‘Business Environment' becomes relevant here. A business entity is influenced by a number of factors which are beyond its control. For instance competition, technology, government policies, social and economic trends are some of the factors included in business environment. As per this concept, all the parameters covered by World Bank for its Ease of Doing Business index fits in the legal aspect of the Business Environment. World Bank comes up with Ease of Doing Business Index annually since 2004, where it ranks 190 countries on various parameters (laws related to these parameters are considered). These include Starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Though these rankings are being widely studied already for the types of impacts it has over a country's economy. This paper is an attempt to use these rankings (2017 & 2018) as the basis for the study of cultural similarities and patterns across the nations. It is an endeavor to find out if the countries having similar rankings in the index share some cultural similarities as well. Rationale for studying the association between culture and ranking is that regulatory environment of country is to some extent a reflection of the culture of that country.