An Empirical Assessment of the Impact of Formal Versus Informal Dispute Resolution on Poverty: A Governance-Based Approach

Abstract

Based on governance-related criteria, this article provides an empirical jurimetric verification of how, where, when and why alternative dispute resolution (ADR) mechanisms provide efficiency-enhancing channels to redress grievances in less developed countries. Based on data collected in 16 developing jurisdictions through a representative sample of poor rural households, the analyses identifies criteria within which ADR enjoys a comparative advantage over court-based formal dispute resolution procedures. The piece further addresses comparative and competitive aspects of formal versus informal dispute resolution and provides policy recommendations in order for the state to assimilate lessons drawn from the functioning of informal mechanisms.

Keywords: alternative dispute resolution, judicial reform, legal reform, economic development, corruption, organized crime, judicial effectiveness, selectivity, processing capacity, case management, cost-benefit

JEL Classification: H40, H41, I30, I31, I32, J70, J71, K00, K10, K40, K41, O18