 Endogenous legal traditions and economic outcomesJournal of Comparative Economics, 2016, vol. 44, issue 2, 416-433 Abstract: Outcomes are deeply influenced by the set of institutions used to aggregate the citizens’ preferences over the harshness of punishment, i.e., the legal tradition. I show that while under common law appellate judges’ biases offset one another at the cost of legal uncertainty, under civil law the legislator chooses a certain legal rule that is biased only when he favors special interests, i.e., when preferences are sufficiently heterogeneous and/or political institutions are sufficiently inefficient. Thus, common law can produce better outcomes only under this scenario. To test this prediction, I construct a novel continuous measure of legal traditions for 49 transplants, many of which reformed the transplanted institutions, and I devise an instrumental variables approach dealing with the endogeneity of both legal and political institutions. The evidence I obtain is robust across several strategies, confirms the model implications, and stresses the relevance of distinguishing between proxies measuring only the technological efficiency of the law and those picking up also the citizenry’s satisfaction with its cultural content. Keywords: Legal origins; Culture; Political institutions; Economic development (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jcecon:v:44:y:2016:i:2:p:416-433 DOI: 10.1016/j.jce.2015.12.008 Access Statistics for this article Journal of Comparative Economics is currently edited by D. Berkowitz and G. Roland More articles in Journal of Comparative Economics from Elsevier |
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