Judicial quality, contract intensity and trade : firm-level evidence from developing and transition countries

Yue MA; Baozhi QU; Yifan ZHANG

doi:10.1016/j.jce.2009.09.002

Judicial quality, contract intensity and trade : firm-level evidence from developing and transition countries

Yue MA, Baozhi QU, Yifan ZHANG

Department of Economics

Research output: Journal Publications › Journal Article (refereed) › peer-review

50 Citations (Scopus)

Abstract

Using firm-level data from 28 developing and transition countries, we investigate how judicial quality affects firm exports through relationship-specific investment. We find that a good legal system significantly increases exports among firms that use more customized goods as intermediate inputs. We control for potential reverse causality using propensity score matching. Our main results are robust to the use of different econometric methods.

Original language	English
Pages (from-to)	146-159
Number of pages	14
Journal	Journal of Comparative Economics
Volume	38
Issue number	2
DOIs	https://doi.org/10.1016/j.jce.2009.09.002
Publication status	Published - 1 Jun 2010

Bibliographical note

We would like to thank the editor, Dan Berkowitz, two anonymous referees and Kenneth Chan for their useful suggestions that substantially improved the paper. This Project was partially sponsored by a Competitive Earmarked Research Grant (LU3409/06H) from the Research Grants Council of the HKSAR Government and a Direct Allocation Grant from Lingnan University (Funding # DR07B4). The usual disclaimer applies.

Keywords

Contract intensity
Institutions
International trade

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10.1016/j.jce.2009.09.002

Cite this

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abstract = "Using firm-level data from 28 developing and transition countries, we investigate how judicial quality affects firm exports through relationship-specific investment. We find that a good legal system significantly increases exports among firms that use more customized goods as intermediate inputs. We control for potential reverse causality using propensity score matching. Our main results are robust to the use of different econometric methods.",

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N2 - Using firm-level data from 28 developing and transition countries, we investigate how judicial quality affects firm exports through relationship-specific investment. We find that a good legal system significantly increases exports among firms that use more customized goods as intermediate inputs. We control for potential reverse causality using propensity score matching. Our main results are robust to the use of different econometric methods.

AB - Using firm-level data from 28 developing and transition countries, we investigate how judicial quality affects firm exports through relationship-specific investment. We find that a good legal system significantly increases exports among firms that use more customized goods as intermediate inputs. We control for potential reverse causality using propensity score matching. Our main results are robust to the use of different econometric methods.

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KW - International trade

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DO - 10.1016/j.jce.2009.09.002

M3 - Journal Article (refereed)

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JO - Journal of Comparative Economics

JF - Journal of Comparative Economics

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ER -

Judicial quality, contract intensity and trade : firm-level evidence from developing and transition countries

Abstract

Bibliographical note

Keywords

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