EconPapers    
Economics at your fingertips  
 

Are Russian Commercial Courts Biased? Evidence from a Bankruptcy Law Transplant

Ariane Lambert-Mogiliansky (), Konstantin Sonin () and Ekaterina Zhuravskaya ()

No w0099, Working Papers from Center for Economic and Financial Research (CEFIR)

Abstract: We study the nature of judicial bias in bankruptcy proceedings following the enactment of the 1998 bankruptcy law in Russia. The two main findings are as follows. First, regional political characteristics affected judicial decisions about the number and types of bankruptcy proceedings initiated after the law took effect. Controlling for indicators of firms’ insolvency and the quality of the regional judiciary, re-organization procedures were significantly more frequent in regions with politically popular governors and governors who had hostile relations with the federal center. Poor judicial quality was also associated with higher incidence of re-organizations. Second, the quality of the regional judiciary ffected performance of firms under the re-organization procedure: in regions with low quality judges, firms that were re-organized according to the 1998 law had significantly lower growth in sales, labor productivity, and product variety compared to firms not subject to bankruptcy proceedings. In contrast, in regions with high quality judges, firms in re-organization outperformed firms not in bankruptcy proceedings. This effect of judicial quality on the performance of re-organized firms was stronger when governors were politically popular. These findings are consistent with the view that politically strong governors subverted enforcement of the 1998 bankruptcy law.

JEL-codes: D23 G33 H11 H77 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cis, nep-pbe and nep-tra
Date: 2007-03
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (46) Track citations by RSS feed

Downloads: (external link)
http://www.cefir.ru/papers/WP99.pdf (application/pdf)

Related works:
Journal Article: Are Russian commercial courts biased? Evidence from a bankruptcy law transplant (2007) Downloads
Working Paper: Are Russian Commercial Courts Biased? Evidence from a Bankruptcy Law Transplant (2007) Downloads
Working Paper: Are Russian Commercial Courts Biased? Evidence from a Bankruptcy Law Transplant (2007)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cfr:cefirw:w0099

Access Statistics for this paper

More papers in Working Papers from Center for Economic and Financial Research (CEFIR) Contact information at EDIRC.
Bibliographic data for series maintained by Julia Babich ().

 
Page updated 2019-10-23
Handle: RePEc:cfr:cefirw:w0099