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Rule of Law and Development


It is widely believed that well-functioning law and justice institutions and a government bound by the rule of law are important to economic, political and social development. As a result, practitioners in the development field have turned increasing attention to reforms intended to improve law and justice institutions. However, many of the assumptions underlying law and justice reform efforts have not been subject to rigorous questioning, theorizing, or testing. The lack of well-developed conceptual and empirical underpinnings is a serious concern, especially in light of past efforts to reform legal institutions - most notably the Law and Development Movement of the 1960s - that are widely believed to have failed due to flawed or insufficient theoretical foundations.

The material on this page provides an introduction to the historical context and current research on the relationship between law and justice institutions and development, as well as a discussion of some basic conceptual issues. This section includes findings on the inter-linkages between the Rule of Law, Law and Justice Institutions, and development. It includes papers surveying the historical and contemporary theoretical debates about the link between law and justice institutions and development as well as links to recent studies. It also includes papers on the concept of the "rule of law," both as a goal of development policy and as an ideal in Western political thought.

1 Rule of Law

2 Law and Justice Institutions and Development

Rule of Law

The Rule of Law as a Goal of Development Policy

A prominent concern in the development community is the "rule of law" and the related concepts from other legal systems -- "état de droit," "estado de derecho," "Rechtstaat." Economic growth, political modernization, the protection of human rights, and other worthy objectives are all believed to hinge, at least in part, on "the rule of law." - Read More 

The Rule of Law in Western Thought

The attached topic brief summarizes the history of the concept of the Rule of Law in Western thought as well as its relevance. - Read More 

Promoting the Rule of Law Abroad

This 2003 paper by the Carnegie Endowment for International Peace discusses the idea of the "rule of law" and the role "building the rule of law" now plays in Western development initiatives. It looks at the success of efforts to improve the rule of law in different regions of the world, and ends by considering the effects of rule of law aid. - Read More 

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Law and Justice Institutions and Development

Economic Development and the Quality of Legal Institutions-Topic Brief

One reason the development community is fostering legal and judicial reform is the belief that, beyond their intrinsic worth, such reforms will help improve economic performance. This belief in the power of legal and judicial reform to spur economic development is supported by a growing body of research showing that economic development is strongly affected by the quality of institutions - including the quality of a nation's legal institutions. This topic brief summarizes the present state of the debate. - Read More 

Creating a Legal Framework for Economic Development

U.S. Judge Richard Posner argues in the attached that when considering legal and judicial reform developing countries' first priority should be to create substantive and procedurally efficient rules of contract and property. A rule is substantively efficient if it sets forth a precept that internalizes an externality or otherwise fosters the efficient allocation of resources. A rule is procedurally efficient if it reduces the cost or increases the accuracy of using the legal system. "Rules," clear-cut prohibitions that can be applied relatively mechanically, are contrasted with "standards." The latter -- examples of which are negligence, due care, and bad faith -- are more complex to administer and require more sophisticated courts and enforcement agencies than many developing countries possess. Read - Creating a Legal Environment for Economic Development .

Law and Development Movement

This topic brief summarizes the history, impact, and lessons of the Law and Development Movement . It started in the 1960s, when the U.S. Agency for International Development, the Ford Foundation, and other private American donors underwrote an ambitious effort to reform the judicial systems and substantive laws of countries in Asia, Africa, and Latin America. - Read More

What is the Role of Legal and Judicial Reform in the Development Process ?

This speech, delivered by Amartya Sen at the first World Bank conference on Comprehensive Legal and Judicial Development, discusses the importance of legal reform within a comprehensive development framework. Legal reform advances freedom-a crucial and constitutive quality of comprehensive development. Legal reform is thus important on its own; its cause need not be indirectly established through its contribution to economic development. Legal reform is, however, also causally interconnected with other constitutive elements of comprehensive development. By acting as a platform where the poor have equal voice and by creating the backbone of the capitalist system, a sound legal system is necessary to advance political and economic development. Read More .

Judicial Reform and Economic Development: A Survey Of Issues

This article published in 1999 surveys the state of research on the relationship between legal/judicial reform and economic development. Read More.

Further Studies on the Links Between Law & Development

Governance Matters, by Daniel Kaufmann, Aart Kraay, and Massimo Mastruzzi

World Development Report 1997: The State in a Changing World

World Development Report 2011: Conflict Security and Developmnet;

World Bank Group publications website

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