Legal Origin or Colonial History?
28 Pages Posted: 3 Aug 2011 Last revised: 17 Dec 2014
Date Written: August 2, 2011
Economists have documented pervasive correlations between legal origins, modern regulation, and economic outcomes around the world. Where legal origin is exogenous, however, it is almost perfectly correlated with another set of potentially relevant background variables: the colonial policies of the European powers that spread the “origin” legal systems through the world. We attempt to disentangle these factors by exploiting the imperfect overlap of colonizer and legal origin, and looking at possible channels, such as the structure of the legal system, through which these factors might influence contemporary economic outcomes. We find strong evidence in favor of non-legal colonial explanations for economic growth. For other dependent variables, the results are mixed.
Keywords: legal origin, colonial origin, colonial history, economic growth, civil law, common law
JEL Classification: K40, N40, P50, O19, O40
Suggested Citation: Suggested Citation