World Bank Justice and Development Working Paper Series No. 6/2009
34 Pages Posted: 23 Nov 2010
Date Written: November 22, 2009
This paper develops a framework and some hypotheses regarding the impact of local-level, informal legal institutions on three economic outcomes: aggregate growth, inequality, and human capabilities. It presents a set of stylized differences between formal and informal legal justice systems, identifies the pathways through which formal systems promote economic outcomes, reflects on what the stylized differences mean for the potential impact of informal legal institutions on economic outcomes, and looks at extant case studies to examine the plausibility of the arguments presented. The paper concludes that local-level, informal legal institutions (i) can support social substitutes for the enforcement of contracts, though these substitutes tend to be limited in range and scale; (ii) are flexible and could conceivably be adapted to serve the interests of the poor and marginalized if supportive organizational and social resources could be brought to buttress the legal claims of the disempowered; and (iii) are more likely to support personal integrity rights than the positive liberties that are also constitutive of development as freedom.
Keywords: justice, development, judicial reform, legal empowerment, informal justice sector, access to justice
Suggested Citation: Suggested Citation
Gauri, Varun, How Do Local-Level Legal Institutions Promote Development? An Exploratory Essay (November 22, 2009). World Bank Justice and Development Working Paper Series No. 6/2009. Available at SSRN: https://ssrn.com/abstract=1713436
By Tanja Chopra