Doing Business

The World Bank's "Doing Business in 2005" includes estimates of how much a country's annual economic growth would gain by going from the being among the worst regulated to joining the least regulated: 2.2%. This is substantial and would compound quickly, making a big difference in some of the world's poorest places -- which have some of the world's worst regulations, including plenty of outright corruption.

Governments that have been kept in power by conventional aid programs, just as Peter Bauer predicted, are the most likely to add to the cost of doing business -- and more the problem than the solution.

Nevertheless, it's very good that the World Bank has finally discovered the obvious.

The IMF insists that macro-economic "reforms" go with its bail-outs. Much better to focus on what look sensible micro-economic reforms.