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Judge Bias in Labor Courts and Firm Performance

Author

Listed:
  • Mr. Pierre Cahuc
  • Stéphane Carcillo
  • Berengere Patault
  • Mr. Flavien Moreau

Abstract

Does labor court uncertainty and judge subjectivity influence firms’ performance? We study the economic consequences of judge decisions by collecting information on more than 145,000 Appeal court rulings, combined with administrative firm-level records covering the whole universe of French firms. The quasi-random assignment of judges to cases reveals that judge bias has statistically significant effects on the survival, employment, and sales of small low-performing firms. However, we find that the uncertainty associated with the actual dispersion of judge bias is small and has a non-significant impact on their average outcomes.

Suggested Citation

  • Mr. Pierre Cahuc & Stéphane Carcillo & Berengere Patault & Mr. Flavien Moreau, 2021. "Judge Bias in Labor Courts and Firm Performance," IMF Working Papers 2021/031, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2021/031
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    Cited by:

    1. is not listed on IDEAS
    2. Tu, Hao & Yang, Shenggang & Dong, Minyi & Dai, Pengyi, 2025. "Judicial Independence and Corporate Total Factor Productivity: Evidence from provincial court centralization," Economic Analysis and Policy, Elsevier, vol. 87(C), pages 1946-1961.
    3. Claudine Desrieux & Romain Espinosa & Michael Visser, 2022. "Simultaneous Decision Making of Juries: Evidence From the Paris Labor Court," CIRED Working Papers hal-04104190, HAL.
    4. Camilo Abbate & Jeffrey Cross & Richard Uhrig, 2025. "Video assistant referee and home field advantage: Implications for referee bias," Southern Economic Journal, John Wiley & Sons, vol. 91(3), pages 1176-1196, January.

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    Keywords

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    JEL classification:

    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings

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