Hofstede studied IBM employees from more than 50 countries.

He began by identifying four

qualities that may be used to differentiate one culture from another. He then added fifth and
sixth dimensions to his work.

1. Power Distance Index (high versus low).

2. Individualism Versus Collectivism.

3. Masculinity Versus Femininity.

4. Uncertainty Avoidance Index (high versus low).

5. Long- Versus Short-Term Orientation.

6. Indulgence Versus Restraint.

 Power Distance Index

This refers to the level of inequality that exists – and is tolerated – between persons in
positions of power and those who do not.

A high PDI score implies that a society supports an unequal, hierarchical power
distribution and that people are aware of "their position" within the system. A low
PDI score indicates that power is shared and widely distributed, and that society
members do not accept unequal distribution of power.

 Individualism vs Collectivism
This refers to the strength of people's bonds with one another in their community.

A high IDV score implies that persons who are not part of a core "family" have poor
interpersonal connections. People here accept less responsibility for the acts and
effects of others.
 People in a collectivist society, on the other hand, are expected to be loyal to the
group to which they belong, and the group will defend their interests in return. The
group is usually bigger, and everyone is responsible for each other's well-being.

 Masculinity vs Femininity

This refers to the gender roles that men and women play. Males and women's duties
overlap less in masculine society, and men are expected to be forceful. Demonstrating
your achievement, as well as being powerful and quick, are considered excellent
qualities.

However, there is a lot of overlap between male and female duties in feminine
civilizations, and modesty is seen as a virtue. Working with colleagues who
collaborate well with one another or having good connections with your direct
superiors is given more weight.

 Uncertainty Avoidance Index

This dimension describes people's ability to deal with worry.

People in communities where Uncertainty Avoidance is prevalent try to make life as
predictable and controlled as possible. They may be tempted to give up if they
discover that they are unable to govern their own life. These folks may allude to their
fate as being "in God's hands."
People in nations with a low UAI score are easier going, open, and inclusive.
Keep in mind that minimising risk does not always imply avoiding uncertainty.
According to Hofstede, people in high-scoring nations may be willing to participate in
hazardous activity since it removes ambiguity or allows them to escape failure.
 Long Versus Short Term Orientation

"Pragmatic Versus Normative (PRA)" was the initial name for this dimension. It
refers to the individuals in a society's temporal horizon. Countries with a long-term
outlook are more realistic, humble, and frugal. People in short-term oriented countries
tend to value principles, consistency, and truth more, and are more religious and
nationalistic.

 Indulgence Versus Restraints

Hofstede's sixth dimension, which he discovered and defined alongside Michael

Minkov, is likewise new, therefore there is less data to go around.

Countries with a high IVR score enable or encourage individuals to gratify their own
desires and emotions, such as enjoying life and having fun, relatively freely. There is
more focus on repressing pleasure and more control of people's behaviour and
behaviour, as well as stronger social standards, in a culture with a low IVR score.

EASE OF DOING BUSINESS

In August 2020, the World Bank Group released a press statement stating that various
inconsistencies had been identified about data changes in the Doing Business 2018
and 2020 reports, and that the data changes were inconsistent with the methodology.
As a result, it is temporarily delaying the release of its well-known Doing Business
rating report while an inquiry into data anomalies is performed. The World Bank
 (WB) acknowledged that it will act on the findings and will rectify data in countries
that were most affected by the anomaly retroactively.
This isn't the first time the EoDB report from the World Bank has sparked debate.
Previously, in 2015, former World Bank head economist Paul Romer said that Chile's
drop in the World Bank's rankings in 2015 was attributable to methodological
adjustments rather than a worsening of the country's business climate. Romer, who
was forced to resign, said that it was the consequence of political intentions on the
part of World Bank officials.

The World Bank's Ease of Doing Business Report (EoDB) report, which was first
published in 2003, is a comparison of business rules in 190 countries. The yearly
report is widely covered by the media and private businesses all around the world.
Even politically, national governments view an increase in a country's position as a
significant economic success. Though the World Bank's assessment is not the only
one provided to show the relative openness of an economy's business environment,
the annual EoDB rating is frequently recognised as the most reliable measure of the
regulatory environment for business activities.

There are a number of elements that contribute to the ease of conducting business;
nonetheless, I'll highlight a few of them:
 Government policy that is good.
 Power supply that is consistent.
 Raw resources are readily available.
 Political stability is important.
 Labour is readily available.
 Land/space availability, etc.
Political Stability and Instability

Political upheaval may have a big influence on business even in nations that are thought
to be politically stable. This might be due to a change in government changing the legal
framework, which, as we saw in the previous section, is broad, but it could also be due to
a shift in political views toward business. This might lead to fewer "business-friendly"
legislation, changes in corporate taxation and regulations, or political shifts that impact
the firm's marketing.

Governments may also alter the social agenda, which can have an influence on
businesses. A government may, for example, establish or adjust a minimum wage. Many
businesses are opposed to a minimum wage because they fear it will harm their bottom
line.

 increases costs
 damages flexibility
 reduces international competitiveness, especially against those countries which do not
have minimum wage levels.

Political unrest may wreak havoc on businesses, causing them to be hesitant to invest
in new money or enter new markets. Because business owners despise risk, it may
even stimulate the movement of activity to a more stable and predictable location.
Political instability in a region where a company works necessitates a high level of
flexibility and adaptability, with the capacity to adjust operations on short notice to
reflect changes in the political climate.

EASE OF DOING BUSINESS RANKINGS

S. No. Economy EoDB Score

1 China 77.9
2 Japan 78
3 US 84
4 Germany 79.7