The official site of Italy's central bank

No. 898 - Firm size and judicial efficiency: evidence from the neighbour's court

We investigate the causal relationship between judicial efficiency and firm size across Italian municipalities exploiting spatial discontinuities in court jurisdictions for identification. The estimated coefficients suggest that the reduction of the length of civil proceedings could exert, all other things being equal, a significant and positive effect on the average size of Italian firms. Results are robust to a number of different specifications, based on two different databases.