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Does Judicial Quality Shape Economic Activity? Evidence from a Judicial Reform in India

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  • Matthieu Chemin

Abstract

This paper investigates the impact of judiciaries on firms' contracting behaviour and economic performance. In 2002, the Code of Civil Procedure Amendment Act was enacted in India to facilitate speedy disposal of civil suits. Some State High Courts hal already enacted some of the amendments contained in this reform a long time ago. This spatial variation in the reform's implementation is used to identify the effect of judicial quality on firm's behavior. Using small informal firm data, I find that the reform led to fewer breaches of contract, encouraged investment, facilitated access to finance, and expanded rental markets.

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Bibliographic Info

Paper provided by CIRPEE in its series Cahiers de recherche with number 0725.

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Date of creation: 2007
Date of revision:
Handle: RePEc:lvl:lacicr:0725

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Keywords: Law and economics; Institutions; Courts; Contracts; Industrial Organisation; Economic Growth; Industrial Performance;

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