Do Lawyers Inhibit Economic Growth? New Evidence from the 50 U.S. States?

James V. Koch and Richard J. Cebula ()
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James V. Koch: Old Dominion University, U.S.A
Richard J. Cebula: University of Tennessee, U.S.A

Journal of Economic Development, 2023, vol. 48, issue 3, 157-173

Abstract: Whether the activities of lawyers might hamper economic growth has been hotly contested over the past three decades. Contradictory conclusions have flowed from evidence that typically has focused on the impact of lawyers on the growth rates of countries. Disputes over definitions and samples that vary among countries have colored portions of these debates. We surmount many of these issues by adopting a 50-state panel covering the period 2005-2018 for the United States and by utilizing widely accepted variables regarding economic activity and who is considered a lawyer. Further, we utilize two distinct measures of the activity of lawyers and find that an increased presence of lawyers reduces per capita real economic growth. Separately, we also find that an increased presence of lawyers reduces the level of per capita real income.

Keywords: Lawyer Influence; Transactions Costs; Economic Growth (search for similar items in EconPapers)
JEL-codes: K00 K40 L00 (search for similar items in EconPapers)
Date: 2023
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