DP8139 Legal Institutions and Economic Development
|Publication Date:||December 2010|
|Keyword(s):||Economic development, Legal institutions, Legal system indicators, Property rights|
|JEL(s):||K1, K4, O16, O43, P14|
|Programme Areas:||Financial Economics|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=8139|
Legal institutions are critical for the development of market-based economies. This paper defines legal institutions and discusses different indicators to measure their quality and efficiency. It surveys a large historical and empirical literature showing the importance of legal institutions in explaining cross-country variation in economic development. Finally, it presents and discusses three different views of why we can observe the large cross-country variation in legal institutions, the social conflict, the legal origin and the culture and religion hypotheses.