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Title:The relevance of judicial procedure for economic growth PDF Logo
Authors:Hayo, Bernd
Voigt, Stefan
Issue Date:2008
Series/Report no.:Joint discussion paper series in economics 2008,28
Abstract:It has been argued that procedural formalism undermines economic efficiency by fostering rent-seeking and corruption. We challenge this view by arguing that a number of judicial procedures foster economic growth by increasing the predict-ability of court decisions, which leads to more transactions and higher investment levels. We investigate the effects on economic growth of 15 judicial procedures. Employing a standard growth model, we find in a cross-section of 67 countries that timeliness, writtenas opposed to oralprocedures, and the right to counsel have a positive effect on growth, whereas the number of independent procedural actions as well as the presumption of innocence have negative effects. Our results partially contradict the results of former studies based on the Lex Mundi dataset.
Subjects:Judicial procedure
legal formalism
judicial Independence
rule of law
investment
growth
JEL:H11
K40
O40
P51
Document Type:Working Paper
Appears in Collections:MAGKS Joint Discussion Paper Series in Economics, Universität Marburg

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