IDEAS home Printed from https://ideas.repec.org/h/pup/chapts/9540-1.html
   My bibliography  Save this book chapter

It’s About The Economy

In: Solomon’s Knot: How Law Can End the Poverty of Nations

Author

Listed:
  • Robert D. Cooter

    (University of California, Berkeley)

  • Hans-Bernd Schäfer

    (Bucerius Law School, Hamburg, Germany)

Abstract

Sustained growth depends on innovation, whether it's cutting-edge software from Silicon Valley, an improved assembly line in Sichuan, or a new export market for Swaziland's leather. Developing a new idea requires money, which poses a problem of trust. The innovator must trust the investor with his idea and the investor must trust the innovator with her money. Robert Cooter and Hans-Bernd Schäfer call this the "double trust dilemma of development." Nowhere is this problem more acute than in poorer nations, where the failure to solve it results in stagnant economies. In Solomon's Knot, Cooter and Schäfer propose a legal theory of economic growth that details how effective property, contract, and business laws help to unite capital and ideas. They also demonstrate why ineffective private and business laws are the root cause of the poverty of nations in today's world. Without the legal institutions that allow innovation and entrepreneurship to thrive, other attempts to spur economic growth are destined to fail.

Suggested Citation

  • Robert D. Cooter & Hans-Bernd Schäfer, 2013. "It’s About The Economy," Introductory Chapters, in: Solomon’s Knot: How Law Can End the Poverty of Nations, Princeton University Press.
    • Handle: RePEc:pup:chapts:9540-1
    as

    Download full text from publisher

    File URL: http://assets.press.princeton.edu/chapters/s9540.pdf
    Download Restriction: no
    ---><---

    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:pup:chapts:9540-1. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Webmaster (email available below). General contact details of provider: http://press.princeton.edu .

    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.