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Twenty years of ‘Law and Finance’: time to take law seriously

Schnyder, G.; Siems, M.; Aguilera, Ruth

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G. Schnyder

M. Siems

Ruth Aguilera


This ‘state of the art’ essay provides a comprehensive discussion of the Law and Finance School (LFS) literature. We show that the first two decades of the LFS have focused on empirically investigating the question ‘does law matter?’ Yet, despite the centrality of law to the LFS, it is based on an incoherent theory of law, which leads to shortcomings in the conceptualization and empirical testing of its hypotheses. We also observe that, rather than addressing this deficiency, the LFS has moved its focus to the contentious concept of ‘legal origin’. We argue that the LFS needs to take law more seriously by returning to its initial focus on the substance of legal rules and by addressing the theoretical question ‘how does law matter?’ We propose venues for future research to develop a solid theoretical framework that would put the empirical investigation of law’s impact on economic outcomes on a more solid footing.


Schnyder, G., Siems, M., & Aguilera, R. (2021). Twenty years of ‘Law and Finance’: time to take law seriously. Socio-Economic Review, 19(1), 377-406.

Journal Article Type Article
Acceptance Date Sep 17, 2018
Online Publication Date Nov 2, 2018
Publication Date 2021-01
Deposit Date Nov 29, 2018
Publicly Available Date Nov 2, 2020
Journal Socio-Economic Review
Print ISSN 1475-1461
Electronic ISSN 1475-147X
Publisher Oxford University Press
Peer Reviewed Peer Reviewed
Volume 19
Issue 1
Pages 377-406


Accepted Journal Article (751 Kb)

Copyright Statement
This is a pre-copyedited, author-produced version of an article accepted for publication in Socio-Economic Review following peer review. The version of record Schnyder, G., Siems, M. & Aguilera, Ruth (2018). Twenty years of ‘Law and Finance’ time to take law seriously. Socio-Economic Review mwy041 is available online at:

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