Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/142253 
Is replaced by the following version: 
Title: 

Do courts matter for firm value? Evidence from the U.S. court system

The document was removed on behalf of the author(s)/ the editor(s).

Year of Publication: 
2016
Series/Report no.: 
IWH Discussion Papers No. 1/2016
Publisher: 
Leibniz-Institut für Wirtschaftsforschung Halle (IWH), Halle (Saale)
Abstract: 
We estimate the link between the court system and firm value by exploiting a U.S. Supreme Court ruling which changed firms' exposure to different courts. We find that exposure to courts which are highly ranked by the U.S. Chamber of Commerce increases firm value. The effect is driven by courts' attitude towards businesses more than by their efficiency and is more pronounced for firms in industries with high litigation risk. We also test whether firms benefit from the ability to steer lawsuits into friendly courts, so-called forum shopping. We provide evidence that a reduction in firms' ability to forum shop decreases firm value, whereas a reduction in plaintiffs' ability to forum shop increases firm value.
Subjects: 
courts
forum shopping
circuit splits
governance
JEL: 
G32
G34
G38
K40
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

Files in This Item:
The document was removed on behalf of the author(s)/ the editor(s) on: May 30, 2018


Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.