IDEAS home Printed from https://ideas.repec.org/a/eee/deveco/v150y2021ics0304387820301875.html
   My bibliography  Save this article

Does legal representation increase investment? Evidence from a field experiment in Kenya

Author

Listed:
  • Aberra, Adam
  • Chemin, Matthieu

Abstract

The legal system enforces contracts and secures property rights, thereby increasing the incentives to exert effort, invest, access credit, and grow. Yet, the high costs of access to the legal system may prevent these gains from taking place. This paper presents the results of a randomized intervention offering the services of a free lawyer for 2 years in a rural setting with prohibitive lawyer fees and numerous land disputes. Not all cases were fully resolved after 2 years, but legal representation increased the security of property rights, which translated into greater investment and access to credit.

Suggested Citation

  • Aberra, Adam & Chemin, Matthieu, 2021. "Does legal representation increase investment? Evidence from a field experiment in Kenya," Journal of Development Economics, Elsevier, vol. 150(C).
    • Handle: RePEc:eee:deveco:v:150:y:2021:i:c:s0304387820301875
    DOI: 10.1016/j.jdeveco.2020.102612
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0304387820301875
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jdeveco.2020.102612?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Anderson, Michael L, 2008. "Multiple Inference and Gender Differences in the Effects of Early Intervention: A Reevaluation of the Abecedarian, Perry Preschool, and Early Training Projects," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt15n8j26f, Department of Agricultural & Resource Economics, UC Berkeley.
    2. repec:clg:wpaper:2013-20 is not listed on IDEAS
    3. Chemin, Matthieu, 2009. "Do judiciaries matter for development? Evidence from India," Journal of Comparative Economics, Elsevier, vol. 37(2), pages 230-250, June.
    4. A. Colin Cameron & Jonah B. Gelbach & Douglas L. Miller, 2008. "Bootstrap-Based Improvements for Inference with Clustered Errors," The Review of Economics and Statistics, MIT Press, vol. 90(3), pages 414-427, August.
    5. Matthew D. Webb, 2023. "Reworking wild bootstrap‐based inference for clustered errors," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 56(3), pages 839-858, August.
    6. Besley, Timothy & Ghatak, Maitreesh, 2010. "Property Rights and Economic Development," Handbook of Development Economics, in: Dani Rodrik & Mark Rosenzweig (ed.), Handbook of Development Economics, edition 1, volume 5, chapter 0, pages 4525-4595, Elsevier.
    7. Blattman, Christopher & Hartman, Alexandra C. & Blair, Robert A., 2014. "How to Promote Order and Property Rights under Weak Rule of Law? An Experiment in Changing Dispute Resolution Behavior through Community Education," American Political Science Review, Cambridge University Press, vol. 108(1), pages 100-120, February.
    8. Alberto Abadie & Susan Athey & Guido W Imbens & Jeffrey M Wooldridge, 2023. "When Should You Adjust Standard Errors for Clustering?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 138(1), pages 1-35.
    9. Ulf von Lilienfeld‐Toal & Dilip Mookherjee & Sujata Visaria, 2012. "The Distributive Impact of Reforms in Credit Enforcement: Evidence From Indian Debt Recovery Tribunals," Econometrica, Econometric Society, vol. 80(2), pages 497-558, March.
    10. Aboal, Diego & Noya, Nelson & Rius, Andrés, 2014. "Contract Enforcement and Investment: A Systematic Review of the Evidence," World Development, Elsevier, vol. 64(C), pages 322-338.
    11. A. Patrick Behrer & Edward L. Glaeser & Giacomo A. M. Ponzetto & Andrei Shleifer, 2021. "Securing Property Rights," Journal of Political Economy, University of Chicago Press, vol. 129(4), pages 1157-1192.
    12. Chemin, Matthieu, 2009. "The impact of the judiciary on entrepreneurship: Evaluation of Pakistan's "Access to Justice Programme"," Journal of Public Economics, Elsevier, vol. 93(1-2), pages 114-125, February.
    13. Deininger, Klaus & Castagnini, Raffaella, 2006. "Incidence and impact of land conflict in Uganda," Journal of Economic Behavior & Organization, Elsevier, vol. 60(3), pages 321-345, July.
    14. Antony Chapoto & T. S. Jayne, 2008. "Impact of AIDS-Related Mortality on Farm Household Welfare in Zambia," Economic Development and Cultural Change, University of Chicago Press, vol. 56(2), pages 327-374, January.
    15. Kenneth Houngbedji, 2018. "Property Rights and Labour Supply in Ethiopia," Annals of Economics and Statistics, GENES, issue 131, pages 137-179.
    16. Ali, Daniel Ayalew & Deininger, Klaus & Goldstein, Markus, 2014. "Environmental and gender impacts of land tenure regularization in Africa: Pilot evidence from Rwanda," Journal of Development Economics, Elsevier, vol. 110(C), pages 262-275.
    17. Goldstein, Markus & Houngbedji, Kenneth & Kondylis, Florence & O'Sullivan, Michael & Selod, Harris, 2018. "Formalization without certification? Experimental evidence on property rights and investment," Journal of Development Economics, Elsevier, vol. 132(C), pages 57-74.
    18. Anderson, Michael L., 2008. "Multiple Inference and Gender Differences in the Effects of Early Intervention: A Reevaluation of the Abecedarian, Perry Preschool, and Early Training Projects," Journal of the American Statistical Association, American Statistical Association, vol. 103(484), pages 1481-1495.
    19. Markus Goldstein & Christopher Udry, 2008. "The Profits of Power: Land Rights and Agricultural Investment in Ghana," Journal of Political Economy, University of Chicago Press, vol. 116(6), pages 981-1022, December.
    20. Place, Frank, 2009. "Land Tenure and Agricultural Productivity in Africa: A Comparative Analysis of the Economics Literature and Recent Policy Strategies and Reforms," World Development, Elsevier, vol. 37(8), pages 1326-1336, August.
    21. Andre, Catherine & Platteau, Jean-Philippe, 1998. "Land relations under unbearable stress: Rwanda caught in the Malthusian trap," Journal of Economic Behavior & Organization, Elsevier, vol. 34(1), pages 1-47, January.
    22. Matthieu Chemin, 2020. "Judicial Efficiency and Firm Productivity: Evidence from a World Database of Judicial Reforms," The Review of Economics and Statistics, MIT Press, vol. 102(1), pages 49-64, March.
    23. Guilherme Lichand & Rodrigo R. Soares, 2014. "Access to Justice and Entrepreneurship: Evidence from Brazil's Special Civil Tribunals," Journal of Law and Economics, University of Chicago Press, vol. 57(2), pages 459-499.
    24. Wooldridge, Jeffrey M., 2007. "Inverse probability weighted estimation for general missing data problems," Journal of Econometrics, Elsevier, vol. 141(2), pages 1281-1301, December.
    25. Young, Alwyn, 2019. "Channeling Fisher: randomization tests and the statistical insignificance of seemingly significant experimental results," LSE Research Online Documents on Economics 101401, London School of Economics and Political Science, LSE Library.
    26. Alwyn Young, 2019. "Channeling Fisher: Randomization Tests and the Statistical Insignificance of Seemingly Significant Experimental Results," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 134(2), pages 557-598.
    27. Aliber, Michael & Walker, Cherryl, 2006. "The impact of HIV/AIDS on land rights: Perspectives from Kenya," World Development, Elsevier, vol. 34(4), pages 704-727, April.
    28. Besley, Timothy, 1995. "Property Rights and Investment Incentives: Theory and Evidence from Ghana," Journal of Political Economy, University of Chicago Press, vol. 103(5), pages 903-937, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Deininger, Klaus & Xia, Fang & Kilic, Talip & Moylan, Heather, 2021. "Investment impacts of gendered land rights in customary tenure systems: Substantive and methodological insights from Malawi," World Development, Elsevier, vol. 147(C).
    2. Seth Garz & Xavier Gine & Dean Karlan & Rafe Mazer & Caitlin Sanford & Jonathan Zinman, 2021. "Consumer Protection for Financial Inclusion in Low- and Middle-Income Countries: Bridging Regulator and Academic Perspectives," Annual Review of Financial Economics, Annual Reviews, vol. 13(1), pages 219-246, November.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Maria Jones & Florence Kondylis & John Loeser & Jeremy Magruder, 2022. "Factor Market Failures and the Adoption of Irrigation in Rwanda," American Economic Review, American Economic Association, vol. 112(7), pages 2316-2352, July.
    2. Congdon Fors, Heather & Houngbedji, Kenneth & Lindskog, Annika, 2019. "Land certification and schooling in rural Ethiopia," World Development, Elsevier, vol. 115(C), pages 190-208.
    3. Benito Arruñada & Marco Fabbri & Michael Faure, 2022. "Land Titling and Litigation," Journal of Law and Economics, University of Chicago Press, vol. 65(1), pages 131-156.
    4. Salvatore Di Falco & Jérémy Laurent‐Lucchetti & Marcella Veronesi & Gunnar Kohlin, 2020. "Property Rights, Land Disputes and Water Scarcity: Empirical Evidence from Ethiopia," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(1), pages 54-71, January.
    5. Ali, Daniel Ayalew & Deininger, Klaus & Goldstein, Markus, 2014. "Environmental and gender impacts of land tenure regularization in Africa: Pilot evidence from Rwanda," Journal of Development Economics, Elsevier, vol. 110(C), pages 262-275.
    6. Jeffrey D. Michler & Anna Josephson, 2022. "Recent developments in inference: practicalities for applied economics," Chapters, in: A Modern Guide to Food Economics, chapter 11, pages 235-268, Edward Elgar Publishing.
    7. Kotchikpa Gabriel Lawin & Lota Tamini, 2018. "Droits de propriété foncière et performance des petits producteurs agricoles des pays en développement : une synthèse de la littérature empirique," CIRANO Working Papers 2018s-05, CIRANO.
    8. Deininger, Klaus & Hilhorst, Thea & Songwe, Vera, 2014. "Identifying and addressing land governance constraints to support intensification and land market operation: Evidence from 10 African countries," Food Policy, Elsevier, vol. 48(C), pages 76-87.
    9. Sonia Bhalotra & Abhishek Chakravarty & Dilip Mookherjee & Francisco J. Pino, 2019. "Property Rights and Gender Bias: Evidence from Land Reform in West Bengal," American Economic Journal: Applied Economics, American Economic Association, vol. 11(2), pages 205-237, April.
    10. Meinzen-Dick, Ruth & Quisumbing, Agnes & Doss, Cheryl & Theis, Sophie, 2019. "Women's land rights as a pathway to poverty reduction: Framework and review of available evidence," Agricultural Systems, Elsevier, vol. 172(C), pages 72-82.
    11. Anthony Harris & Anthony D'Agostino & Sara Litke-Farzaneh & Beryl Seiler & Matt Sloan, "undated". "Morocco Land Productivity Project: Evaluation Design Report," Mathematica Policy Research Reports f3fc788501b64608b17e1cb23, Mathematica Policy Research.
    12. MacKinnon, James G. & Nielsen, Morten Ørregaard & Webb, Matthew D., 2023. "Cluster-robust inference: A guide to empirical practice," Journal of Econometrics, Elsevier, vol. 232(2), pages 272-299.
    13. Genicot, Garance & Hernandez-de-Benito, Maria, 2022. "Women’s land rights and village institutions in Tanzania," World Development, Elsevier, vol. 153(C).
    14. Li, Wen & Peng, Qing, 2023. "Digital courts and corporate investment in sustainability: Evidence from China," International Review of Financial Analysis, Elsevier, vol. 88(C).
    15. Deininger, Klaus & Xia, Fang & Kilic, Talip & Moylan, Heather, 2021. "Investment impacts of gendered land rights in customary tenure systems: Substantive and methodological insights from Malawi," World Development, Elsevier, vol. 147(C).
    16. Meinzen-Dick, Ruth Suseela & Quisumbing, Agnes R. & Doss, Cheryl R. & Theis, Sophie, 2017. "Women’s land rights as a pathway to poverty reduction: A framework and review of available evidence," IFPRI discussion papers 1663, International Food Policy Research Institute (IFPRI).
    17. Gerritse, Michiel, 2021. "Does trade cause detrimental specialization in developing economies? Evidence from countries south of the Suez Canal," Journal of Development Economics, Elsevier, vol. 152(C).
    18. Kang, Munsu & Schwab, Benjamin & Yu, Jisang, 2020. "Gender differences in the relationship between land ownership and managerial rights: Implications for intrahousehold farm labor allocation," World Development, Elsevier, vol. 125(C).
    19. Daniela Collazos & Leopoldo Fergusson & Miguel La Rota & Daniel Mejía & Daniel Ortega, 2020. "CSI in the tropics: Experimental evidence of improved public service delivery through coordination," Documentos de Trabajo 18215, The Latin American and Caribbean Economic Association (LACEA).
    20. Ghebru, Hosaena & Girmachew , Fikirte, 2017. "Scrutinizing The Status Quo: Rural Transformation And Land Tenure Security In Nigeria," Feed the Future Innovation Lab for Food Security Policy Research Papers 264394, Michigan State University, Department of Agricultural, Food, and Resource Economics, Feed the Future Innovation Lab for Food Security (FSP).

    More about this item

    Keywords

    Legal system; Investment;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:deveco:v:150:y:2021:i:c:s0304387820301875. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/devec .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.