This paper analyzes how private decisions and public policies are shaped by personal and societal preferences ("values"), material or other explicit incentives ("laws") and social sanctions or rewards ("norms"). It first examines how honor, stigma and social norms arise from individuals'...

While scholars have hypothesized about the sources of variation in property rights for over 2500years, it is only very recently that researchers have begun to test these theories empirically. Thispaper reviews both the theory and empirical evidence supporting and refuting the law andendowment...

We investigate the extent to which perceived quality of judicial institutions has an impact on individuals' propensity for criminal and dishonest behavior and on their views regarding the acceptability of dishonesty and law-breaking. We use micro data on residents of 25 European countries and...

We document a statistical association between the severity of the persecution and mass murder of Jews (the Holocaust) by the Nazis during World War II and long-run economic and political outcomes within Russia. Cities that experienced the Holocaust most intensely have grown less, and cities as...

Commerce requires trust, but trust is difficult when one group consistently fears expropriation by another. If men have a comparative advantage at violence and there is little rule-of-law, then unequal bargaining power can lead women to segregate into low-return industries and avoid...

In the Wealth of Nations, Adam Smith argues that a country's national income depends on its labor productivity, which in turn hinges on the division of labor. But why are some countries able to take advantage of the division of labor and become rich, while others fail to do so and remain poor?...

Without the rule of law, traders who incur trading costs can be held up by counter-parties who are stronger in anarchic bargaining. The favourable terms which the latter extract can overcrowd that side of the market, dissipating the benefits. We establish plausible necessary and sufficient...

When Russia launched mass privatization, it was widely believed that it would create a powerful constituency for the rule of law. That didn't happen. We present a dynamic equilibrium model of the political demand for the rule of law and show that beneficiaries of mass privatization may fail to...

How does the lack of legitimacy of property rights affect the dynamics of the creation of the rule of law? We investigate the demand for the rule of law in post-Communist economies after privatization under the assumption that theft is possible, that those who have "stolen" assets cannot be...

The paper examines changes in labor regulation between 1898 and 1940 in the context of issues related to rule of law in two areas. 1) Many see the 1905 Lochner Supreme Court decision on men’s hours laws as the beginning of 30 years in which labor regulation was stymied by the doctrine of...