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Licensed Unlicensed Requires Authentication Published by De Gruyter July 12, 2014

The Legal Origin of Income Inequality

  • Giuseppe Maggio , Alessandro Romano EMAIL logo and Angela Troisi


The legal origin movement is implicitly functionalist, while it explicitly prioritizes economic dimensions of development. From this perspective, the empirical findings presented in this paper seem to uncover the existence of a paradox. On the one hand, common law countries are apparently characterized by countless advantages, yet they do not grow faster than civil law countries. On the other hand, common law countries present a more unequal distribution of income, thus suggesting that also from a static perspective there is no a priori reason to prefer a common law system. To further investigate this paradox, we analyze if common law countries are at least characterized by a better kind (earned) of inequalities. However, as the economic distinction between inequalities of opportunities and inequalities of effort is too fragile, this proved to be an impossible task. We are therefore left with the unsolved riddle of the contradicting results obtained by the legal origins literature. From a more practical perspective, the empirical findings seem to disprove the dogma that common law countries are under every condition the perfect benchmark for reforms in developing countries.


An earlier version of this paper was presented as Piecemeal Legal Origin at the Annual Meeting of Juris Diversitas held at the Swiss Institute of Comparative Law in Lausanne, at the 11th Annual Meeting of the German Association of Law and Economics, at the 2013 Annual Meeting of the Canadian Law and Economics Association, and at the 2014 Annual Conference of the Law and Development Institute. The comments and the suggestions that we received at these meetings were extremely helpful. We are also particularly indebted to Jack Vromen, Alexandra D’Onofrio, Y.S. Lee, Roberto Pardolesi, and three anonymous referees.


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Published Online: 2014-7-12
Published in Print: 2014-10-1

©2014 Law and Development Review

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