Effect of business regulation on investment in emerging market economies

This paper provides an empirical analysis of the business regulatory factors that influence investment in a selection of 29 emerging market economies. Both theoretical and empirical literature on the effect of the regulatory environment on investment is reviewed. A panel data analysis over the period 2003–2007 reveals that investment is influenced by secure property rights and the degree of business entry regulation. The results carry important policy implications for improving the investment climate of emerging market economies.