The Firms Speak: What the World Business Environment Survey Tells Us about Constraints on Private Sector Development

This chapter summarizes the salient results of the World Business Environment Survey (WBES). It shows that important dimensions of the climate for business operation and investment can be measured, analyzed, and compared across countries, and that governance is key to the business environment and investment climate. The survey findings suggest that key policy, institutional, and governance indicators affect the growth of a firm's sales and investment and the extent to which firms operate in the unofficial economy. Further, the paper provides empirical support for some commonly held notions, while challenging others. It suggests a link between taxation, financing, and corruption on the one hand, and growth and investment on the other, and it highlights the costs to economies where the state is captured by a narrow set of private interests.

Valence Bond Entanglement and Fluctuations in Random Singlet Phases

The ground state of the uniform antiferromagnetic spin-1/2 Heisenberg chain can be viewed as a strongly fluctuating liquid of valence bonds, while in disordered chains these bonds lock into random singlet states on long length scales. We show that this phenomenon can be studied numerically, even in the case of weak disorder, by calculating the mean value of the number of valence bonds leaving a block of $L$ contiguous spins (the valence-bond entanglement entropy) as well as the fluctuations in this number. These fluctuations show a clear crossover from a small $L$ regime, in which they behave similar to those of the uniform model, to a large $L$ regime in which they saturate in a way consistent with the formation of a random singlet state on long length scales. A scaling analysis of these fluctuations is used to study the dependence on disorder strength of the length scale characterizing the crossover between these two regimes. Results are obtained for a class of models which include, in addition to the spin-1/2 Heisenberg chain, the uniform and disordered critical 1D transverse-field Ising model and chains of interacting non-Abelian anyons.Comment: 8 pages, 6 figure