Testing Legal Origins Theory within France: Customary Laws versus Roman Code
David Le Bris
KEDGE Business School
Legal origins theory emphasizes the negative consequences of civil law on financial and, subsequently, economic development. Before the Revolution, French territory was strictly divided according to the legal regime. The southern part of France was under the Roman civil law and the north was under customary laws which, as with common law, gave more flexibility to judges and less right to the state. This dichotomy offers the unique opportunity to test the legal origins theory free from cross-country bias. Using fiscal and census data across 86 Departments from 1801-1821, we test if Departments under civil law for six centuries exhibit lower financial and economic outcomes. We find that civil law Departments do exhibit lower economic performances but this difference is not robust when controlled for fundamental factors. The civil law appears even to have a positive effect in many specifications. Old Regime France does not confirm the legal origins theory.
Number of Pages in PDF File: 35
Keywords: Law and Finance, Economic development, France
JEL Classification: 043, O1, P48, N43
Date posted: November 25, 2013 ; Last revised: January 31, 2015
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