Do Lawyers Impair Economic Growth?

The large U.S. legal profession hurts economic productivity in the United States and our economic competitiveness abroad according to a common claim A number of studies support that claim, but they suffer from serious flaws. I reexamine the hypothesis that large lawyer populations impair economic growth and suggest that it lacks theoretical and empirical support. The hypothesis depends on false assumptions about the organizational capability and interest of the legal profession; the empirical research in sup port of the hypothesis depends on flawed lawyer data, unusual combinations of high lawyer populations and low economic growth in one or two countries, and the unjustified use of lawyer population figures from the 1980s in analyses of economic growth prior to that period. I present the results of research on lawyer populations and economic growth among the US. states and in a sample of countries, correcting for the worst flaws of past research The results do not support the claim that large lawyer populations impair aggregate economic growth The analysis is not intended as the final answer on this important question but rather as an encouragement for a more sophisticated understanding of the role of lawyers in late modern economies.     

Governance and Growth: A Simple Hypothesis Explaining Cross-Country Differences in Productivity Growth

Cross-country evidence shows that a subset of developing countries isgrowing very rapidly, taking advantage of opportunities to ``catch-up'' atthe same time that other developing countries are growing slowly. We arguethat this is due to differences in the quality of governance. Inparticular we show that productivity growth is higher in better-governedcountries.     

Economy,logic, and action

Interviewed by Richard Swedberg