Legal Institutions and Firm Performance in Brazil
Mueller, B., N. Campos and M. Iootty. 2013. “Legal Institutions and Firm Performance,” Economic Analysis of Law Review, Vol. 3, (1).
21 Pages Posted: 27 Dec 2017
Date Written: June 20, 2013
This paper analyses the specific mechanisms through which legal institutions and the Rule of Law affect firm performance using survey evidence from a sample of about 100 Brazilian firms in the textile and electronics industries. The data provide firms’ perceptions of whether judicial institutions are just, impartial, corruptible, swift, accessible, consistent and effective, which allowed to create an index of firms’ perception of legal institutions. It is analyzed how these perceptions vary across firms with different characteristics, such as large/small employer, foreign/domestic-owned, exporter/non-exporters and revenues level. The results suggest that firms that had a better perception of the Judiciary increased levels of employment and had better economic performance.
Keywords: Legal Institutions; Predictability; Public Policy; Contract; Judiciary; Brazil
JEL Classification: O12, D23, K20, O17, K30
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