Joel Kurtzman & Glenn Yago refresh Mr. Kurtzman’s ranking of regulatory efficiency, first published in 2001 by PricewaterhouseCoopers. Kurtzman is now working from the Milken Institute, an economic think tank.
Two weeks ago, Glenn Yago and I released the 2007-2008 Opacity Index at the Milken Institute Global Conference. I then presented it at the World Bank.
I am attaching the updated scores and the latest Opacity Index report.
In the 2007-2008 rankings, the United States fell to number 14, from number 4, in the 2005-2006 rankings. This reflects increased risks in the United States.
The decline in US scores was the result of three issues:
* Poor performance by US rating agencies;
* Continued high costs and difficulties resulting from elements of the Sarbanes-Oxley legislation;
* Improved scores by other countries reflecting a broad, global movement to international accounting standards;
China’s ranking improved by one place, to 41st place from 42nd, , largely as a result of better accounting practices and standards.
Among European countries, the inefficiency of the French legal system continues to pose problems, especially when compared to legal systems in Germany and the United Kingdom.
Australia, Finland, Ireland and Singapore continue to have the world’s most efficient regulatory structures.
In our analysis, Opacity continues to be track with levels of foreign direct investment, access to capital, size of bank assets, equity market capitalization, and per capita GDP growth.