Are well-functioning formal judicial institutions important for economic development, or can informal contracting arrangements provide adequate substitutes? This paper aims to answer this question using variation across industries in their reliance on contracts along with variation across Indian states in the average speed of courts. The identification strategy is motivated by theory from the incomplete contracting literature in which it is argued that transactions involving relationship-specific investments are more exposed to post-contractual opportunism and hence have greater need for efficient contract enforcement. The paper finds that the interaction between state level court efficiency and industry level relationship-specificity is highly predictive of future growth in India's formal manufacturing sector. The threat of omitted variable bias is minimized by the inclusion of state and industry fixed effects, while a number of robustness checks and placebo tests rule out competing explanations and provide additional confidence in the hypothesized mechanism.

中文翻译：

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迟到的正义是增长被拒绝：缓慢的法院对印度关系特定行业的影响

运作良好的正式司法机构对经济发展是否重要，或者非正式合同安排是否可以提供足够的替代品？本文旨在利用不同行业对合同的依赖程度以及印度各邦法院平均审理速度的差异来回答这个问题。识别策略的动机来自不完整的合同文献，其中认为涉及特定关系投资的交易更容易受到后合同机会主义的影响，因此更需要有效的合同执行。该论文发现，州级法院效率与行业级关系特异性之间的相互作用对印度正规制造业的未来增长具有高度预测性。