Economic Development, Legality, and the Transplant Effect

Posted: 2 May 2003

See all articles by Daniel Berkowitz

Daniel Berkowitz

University of Pittsburgh - Department of Economics

Katharina Pistor

Columbia University School of Law

Jean-Francois Richard

University of Pittsburgh - Department of Economics

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Abstract

We analyze the determinants of effective legal institutions (legality) using data from forty-nine countries. We show that the way the law was initially transplanted and received is a more important determinant than the supply of law from a particular legal family. Countries that have developed legal orders internally, adapted the transplanted law, and/or had a population that was already familiar with basic principles of the transplanted law have more effective legality than countries that received foreign law without any similar pre-dispositions. The transplanting process has a strong indirect effect on economic development via its impact on legality, while the impact of particular legal families is weaker and not robust to alternative legality measures.

JEL Classification: O1, O57, K00

Suggested Citation

Berkowitz, Daniel and Pistor, Katharina and Richard, Jean-Francois, Economic Development, Legality, and the Transplant Effect. Available at SSRN: https://ssrn.com/abstract=290000

Daniel Berkowitz

University of Pittsburgh - Department of Economics ( email )

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HOME PAGE: http://www.pitt.edu/~dmberk

Katharina Pistor (Contact Author)

Columbia University School of Law ( email )

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Jean-Francois Richard

University of Pittsburgh - Department of Economics ( email )

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