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Institutional Compliance by Firms in Transition Economies

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Abstract

This research revisits the effects of a country’s institutional framework on individual firms’ behavior, in particular focusing on their propensity to comply with legal rules in transition economies. The authors purport to explain the variation in compliance with legal rules and employ a rich data set on thousands of firms from dozens of transition countries to this end. They find that most of the variation emanates from country-wide differences in institutional quality, although some firm characteristics play a role as well. They also find indications that differences across countries are smoothed with income.

Suggested Citation

  • Jorge Guillen & Paola Vargas, 2010. "Institutional Compliance by Firms in Transition Economies," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 60(2), pages 138-150, May.
    • Handle: RePEc:fau:fauart:v:60:y:2010:i:2:p:138-150
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    More about this item

    Keywords

    firms; institutions; law compliance; country differences; transition economies;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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