Legal institutions, innovation, and growth


Type
Article
Change log
Authors
Anderlini, L 
Immordino, G 
Riboni, A 
Abstract

jats:pWe analyze the relationship between legal institutions, innovation, and growth. We compare a rigid legal system (the law is set before the technological innovation) and a flexible one (the law is set after observing the new technology). The flexible system dominates in terms of welfare, amount of innovation, and output growth at intermediate stages of technological development—periods when legal change is needed. The rigid system is preferable at early stages of technological development, when commitment problems are severe. For mature technologies, the two legal systems are equivalent. We find that rigid legal systems may induce excessive R&D investment.</jats:p>

Description
Keywords
38 Economics, 3801 Applied Economics, 3802 Econometrics, 3803 Economic Theory, Genetics, Human Genome
Journal Title
International Economic Review
Conference Name
Journal ISSN
0020-6598
1468-2354
Volume Title
54
Publisher
Wiley
Rights
All rights reserved