Legal Rules Variation and Countries’ Economic and Financial Performance
Considering the large number of legal reforms implemented over the period 2006–2014, particularly in French civil law countries, this chapter aims to establish whether variation in legal rules and regulatory outcomes have been associated with an improvement in financial and economic developmental outcomes. By estimating panel specifications using a fixed effects estimator with data averaged over 3-year periods, the evidence does not support the existence of a clear-cut effect of legal rules and regulatory indicators on financial and economic performance. This finding appears to accord with the view of those that question the widespread tendency in the lawmaking sphere over the past decade to imitate tools related to the common law (the pretended winning origin). If the common law does not systematically lead to better legal rules and institutions than the French civil law (as the recent critical literature suggests), it is far from clear that adopting common-law tools will improve the efficiency of the legal system and the performance of the economy.
KeywordsLegal change Legal reforms Economic performance Financial development Fixed-effects estimation
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