Economic Growth and Judicial Independence - Cross Country Evidence Using a New Set of Indicators

Posted: 20 Jun 2003

See all articles by Lars P. Feld

Lars P. Feld

Walter Eucken Institute; University of Freiburg - College of Economics and Behavioral Sciences; CESifo (Center for Economic Studies and Ifo Institute)

Stefan Voigt

University of Hamburg - Institute of Law & Economics; CESifo (Center for Economic Studies and Ifo Institute)

Multiple version iconThere are 2 versions of this paper

Abstract

Rational politicians have an interest in an independent judiciary because it can potentially help them make their promises more credible. But if politicians' (short-term) preferences deviate from the dicta of the judiciary, they might also have incentives to renege on judicial independence. To make these two conflicting aspects measurable, two indicators are introduced: (i) a de iure indicator focusing on the legal foundations of judicial independence and (ii) a de facto indicator focusing on the real-life amount of judicial independence. It is hypothesized and tested by formulating an econometric model for a cross section of 57 countries that judicial independence affects economic growth. While de iure judicial independence does not have an impact on economic growth, de facto judicial independence positively influences real GDP growth per capita.

Keywords: Economic Growth, Rule of Law, Judicial Independence

JEL Classification: H11, K40, 040, P51

Suggested Citation

Feld, Lars P. and Voigt, Stefan, Economic Growth and Judicial Independence - Cross Country Evidence Using a New Set of Indicators. European Journal of Political Economy, Forthcoming. Available at SSRN: https://ssrn.com/abstract=390724

Lars P. Feld

Walter Eucken Institute ( email )

Goethestrasse 10
Freiburg im Breisgau, Baden-W├╝rttemberg D-79100
Germany

University of Freiburg - College of Economics and Behavioral Sciences ( email )

Freiburg, D-79085
Germany

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Stefan Voigt (Contact Author)

University of Hamburg - Institute of Law & Economics ( email )

Johnsallee 35
Hamburg, 20148
Germany
+49-40-428385782 (Phone)
+49-40-428386794 (Fax)

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

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