Dethier, Jean-JacquesHirn, MaximilianStraub, Stéphane2012-05-212012-05-212008-12https://hdl.handle.net/10986/6295This paper surveys the recent literature which examines the impact of business climate variables on productivity and growth in developing countries using enterprise surveys. Comparable enterprise surveys today cover some 70,000 firms in over 100 countries around the world. The literature that has analyzed this data provides evidence that a good business climate drives growth by encouraging investment and higher productivity. Various infrastructure, finance, security, competition and regulation variables have been shown to significantly impact firm performance. Section 1 of this paper outlines the theoretical framework that underpins the investment climate literature. Section 2 describes the available datasets and surveys the key findings of the empirical literature, first macroeconomic and then microeconomic studies. Particular attention is paid to the robustness of the reported results. Section 3 highlights important econometric issues common to this literature and suggests a research agenda and possible improvements in survey design.CC BY 3.0 IGOACCOUNTINGAIRPORTSALTERNATIVE TRANSPORTALTERNATIVE TRANSPORT MODESAVAILABILITY OF CREDITBALANCE SHEETBANK LOANSBANKING SERVICESBANKSBEST-PRACTICEBINDING CONSTRAINTBOTTLENECKSBUSINESS CLIMATEBUSINESS ENVIRONMENTBUSINESS ENVIRONMENTSBUSINESS INDICATORSBUSINESS SERVICESBUSINESSESCALCULATIONSCAPITAL ACCUMULATIONCAPITAL GOODSCAPITAL STOCKCOLLATERALCOLLATERAL REQUIREMENTSCOMPETITION POLICIESCOMPETITIVENESSCOMPUTERSCONGESTIONCORE BUSINESSCOST ESTIMATESCOST OF FINANCECOUNTRY DUMMIESCOUNTRY FIXED EFFECTSCOUNTRY-LEVEL INDICATORSCREDIT CONSTRAINTSCREDITSCUSTOMSCUSTOMS CLEARANCEDEMOCRACYDEVELOPING COUNTRIESDEVELOPING ECONOMIESDEVELOPMENT ECONOMICSDIRECT ROUTESDOMESTIC COMPETITIONE-MAILECONOMIC DEVELOPMENTECONOMIC GROWTHECONOMIC PERFORMANCEECONOMICSECONOMIES OF SCALEELASTICITIESELECTRICITYELECTRICITY INFRASTRUCTUREEMPLOYMENTEMPLOYMENT CREATIONEMPLOYMENT GROWTHENFORCEMENT OF REGULATIONSENTERPRISE DEVELOPMENTENTERPRISE SURVEYENTERPRISE SURVEYSEQUIPMENTFINANCIAL CONSTRAINTFINANCIAL CONSTRAINTSFINANCIAL MANAGERSFINANCIAL MARKETSFINANCIAL OBSTACLESFINANCIAL SERVICESFIRM GROWTHFIRM PERFORMANCEFIXED INVESTMENTFOREIGN BANKSFOREIGN COMPETITIONFOREIGN LABORFOREIGN OWNERSHIPFOREIGN WORKERSGOOD GOVERNANCEGROWTH RATEGROWTH RATESHIGHWAYHIGHWAY CONSTRUCTIONHIGHWAY IMPROVEMENTHIGHWAY PROGRAMHIGHWAYSHUMAN CAPITALHUMAN RESOURCEINCOMEINCOME GROUPSINCOME LEVELINCOME RANGEINCOMESINDEBTEDNESSINDIVIDUAL FIRMINDUSTRIAL STRUCTUREINFRASTRUCTURE DEVELOPMENTINFRASTRUCTURE INFORMATIONINNOVATIONINSPECTIONINSPECTIONSINTEREST RATESINVENTORIESINVESTMENT CLIMATEINVESTMENT DECISIONINVESTMENT DECISIONSJOB CREATIONLABOR FORCELABOR FORCE GROWTHLABOR FORCE PARTICIPATIONLABOR MARKETSLABOR REGULATIONSLABOR RELATIONSLARGE ENTERPRISELARGE ENTERPRISESLARGE FIRMSLAW ENFORCEMENTLEGAL SYSTEMLOANLOAN APPLICATIONLOCAL BUSINESSLONG TERM FINANCEMACROECONOMIC ANALYSESMACROECONOMIC STABILITYMANUFACTURINGMARKET BEHAVIORMIDDLE-INCOME COUNTRIESMOBILE PHONESMORTALITYNEW JOBSNEW PRODUCTSNEW TECHNOLOGYOUTPUTPERFORMANCE INDICATORSPHONE LINEPHONE LINESPHYSICAL INFRASTRUCTUREPOLICEPOLITICAL ECONOMYPOPULATION GROWTHPOWER OUTAGEPOWER OUTAGESPRIVATE INFRASTRUCTUREPRIVATE INVESTMENTPRIVATE PROPERTYPROBABILITYPRODUCTION TIMEPRODUCTIVE CAPITALPRODUCTIVITYPROPERTY RIGHTSPROSPERITYPUBLIC GOODSQUESTIONNAIREQUESTIONNAIRESR&DRAILWAYSRAW DATARED TAPEREGRESSION ANALYSESREGRESSION ANALYSISREGULATORY ENVIRONMENTREGULATORY FRAMEWORKREGULATORY REQUIREMENTSRELIABILITYRESULTRESULTSROADROADSROUTESALESSALES GROWTHSAVINGSSAVINGS RATESEARCHSENIORSERVICE RELIABILITYSKILL SHORTAGESSMALLER FIRMSSOCIAL BENEFITSSOCIAL CAPITALSTANDARDIZATIONSUPPLIERSTAXTECHNOLOGICAL INFRASTRUCTURETECHNOLOGICAL INNOVATIONTELECOMTELECOMMUNICATIONSTELEPHONETELEPHONE CONNECTIONTELEPHONE SERVICETELEPHONE SERVICESTRADE REFORMSTRANSITTRANSITION COUNTRIESTRANSPORTTRANSPORTATIONTRANSPORTATION INFRASTRUCTUREUSESVALUABLEVEHICLESVOLATILITYWEALTHWEBWorld Bank10.1596/1813-9450-4792