Law and Firms' Access to Finance

Thorsten Beck, Asli Demirguc-Kunt, Ross Levine

NBER Working Paper No. 10687
Issued in August 2004
NBER Program(s):International Finance and Macroeconomics

This paper contributes to the literature on how a country's legal origin influences the operation of its financial system by using firm-level survey data on the obstacles that firms face in raising external finance. The paper assesses two channels through which legal origin may influence the financial system. It finds that the adaptability of a country's legal system is more important for explaining the obstacles that firms face in accessing external finance than the political independence of the judiciary.

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Document Object Identifier (DOI): 10.3386/w10687

Published: Thorsten Beck & Asli Demirguc-Kunt, 2005. "Law and Firms' Access to Finance," American Law and Economics Review, Oxford University Press, vol. 7(1), pages 211-252. citation courtesy of

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