TY  - UNPD
A1  - Pezone, Vincenzo
T1  - The real effects of judicial enforcement
T2  - SAFE working paper series ; No. 192, LawFin working paper ; No. 11
N2  - This paper shows that judicial enforcement has substantial effects on firms’ decisions with regard to their employment policies. To establish causality, I exploit a reorganization of the court districts in Italy involving judicial district mergers as a shock to court productivity. I find that an improvement in enforcement, as measured by a reduction in average trial length, has a large, positive effect on firm employment. These effects are stronger in firms with high leverage, or that belong to industries more dependent on external finance and characterized by higher complementarity between labor and capital, consistent with a financing channel driving the results. Moreover, in presence of stronger enforcement, firms can raise more debt to dampen the impact of negative shocks and, in this way, reduce employment fluctuations.
T3  - LawFin Working Paper - 11 
T3  - SAFE working paper - 192 n 
KW  - Law Enforcement
KW  - Duration of Civil Proceedings
KW  - Financing Constraints
KW  - Finance and Employment
Y1  - 2020
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/61651
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-616519
IS  - Friday 24th April, 2020
EP  - 66
PB  - Center for Advanced Studies on the Foundations of Law and Finance, House of Finance, Goethe University
CY  - Frankfurt am Main
ER  -