Litigation as a Measure of Well-Being

Abstract:     
The common perception is that high or growing litigation rates in a country are a sign of societal pathology Studies of litigation rates, however, consistently report that lawsuit filings per capita increase with economic prosperity, thus suggesting that litigation rates are a natural consequence of prosperity and not necessarily evidence of an overly litigious populace. India’s substantial interstate variation in litigation rates and in economic and noneconomic measures of well-being provide an opportunity to evaluate the relation between well-being and litigation rates. Using many years of data on civil filings in India’s lower Courts and high Courts, we present evidence that more prosperous states have higher civil litigation rates. We also report the first evidence that accounting for noneconomic well-being, as measured by the education and life expectancy components of the Human Development Index, explains litigation rate patterns better than explanations using a more purely economic measure of well-being, GDP per capita. Despite India’s continuing economic growth, we present data that indicates India’s enormous and growing civil case backlog has discouraged civil case filings in recent years. These findings raise the question whether India’s future economic growth will be compromised if courts at all levels, particularly lower courts, are not able to more quickly resolve disputes.

Number of Pages in PDF File: 36

Keywords: empirical studies, India, litigation

JEL Classification: K1, O1

working papers series