Link Between Women, Business, and the Law Index and Countries’ Governance and Risk Indicators

As current development challenges have affected women disproportionately, it has become even more crucial to determine obstacles to women’s economic involvement and revise discriminatory items in the law. A starting point of this process can be the accurate measurement of women’s economic position in the law. The World Bank’s the Women, Business, and the Law Index (WBLI), which considers the laws and regulations that can influence women’s economic opportunities, is an example of such measure. This empirical chapter systematically investigates the relationship between the Women, Business, and the Law Index and different governance quality indicators, as well as social, political, and economic risks of countries to determine possible country characteristics and conditions that can promote the laws enhancing economic participation of women. In the study, the indicators published in the International Country Risk Guide are utilized to assess governance qualities and economic, political, and social risks, such as Bureaucracy Quality, Composite Risk Rating, Corruption, Democratic Accountability, and Economic Risk Rating. The data set covers 137 developing and advanced countries between 1984 and 2021. Different correlation, causality, and regression analyses are conducted to understand the nature of the relationship between the Women, Business, and the Law Index and country indicators for governance quality and risks. The results show that the strongest link between the indicators and the Women, Business, and the Law Index belongs to democracy accountability, religious tensions, and composite risk ratings of countries. Shorter term factors, such as individual economic and financial risk items, seem to play a less significant role in determining the scores of the Women, Business, and the Law Index. One important policy implication is that as countries improve their governance quality and overall risks, they are more likely to legislate laws in support of women’s participation in economic activities.