Economia 2.2 (2002) 137-147
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Edgardo Buscaglia: The paper by Florencio López-de-Silanes provides an extremely effective and well-conceived guide for academics and practitioners focused on fostering politically sustainable, efficiency-enhancing legal and judicial reforms. The piece also provides a survey of the most recent literature on best-practice judicial and legal reforms. Yet the list of factors enumerated in López-de-Silanes's paper is not comprehensive. The comments below build on previous research to identify additional necessary elements of legal and judicial reforms, as suggested by national experiences within the region.
The mix of increasing political democratization and the adoption of market reforms has created additional, but unfulfilled, demands for improvements in legal and judicial frameworks throughout the developing world, fostering the need for more effective private and public dispute resolution mechanisms. 1 Within this context, the political and economic forces preconditioning improvements in judicial performance clearly must be understood and accounted for. These preconditioning factors must be focused on the "right" kind of legal environment within which judicial efficiency-enhancing court rulings can later be enforced in an unbiased and transparent fashion.
International experience shows that the likelihood of successfully implementing the legal frameworks that the author has in mind depends not only on the institutional capabilities of enforcement that are rightly enumerated in López-de-Silanes's paper, but also on the political benefits and costs tacitly assessed by the main groups of political actors with the capacity to propose and implement the necessary reforms. 2 An effective design for legal and judicial reforms therefore cannot stop at taking into account the costs and benefits to society of enhancing the quality of the judiciary in general. Equally important are the changes in present and future individual benefits and costs as anticipated by public officials whose [End Page 137] perceived rents and power will be altered as a result of legal or judicial reforms that would limit their excessive discretion, enhance institutional transparency, and introduce impact-based government targets (that is, results-based management).
For example, previous studies of judicial reforms in Latin America argue that the institutional inertia surrounding the enactment of reform stems from the long-term nature of the reform benefits, such as increasing job stability, judicial independence, and professional prestige. 3 Contrast the long-term nature of those benefits with the short-term nature of the main costs of judicial reform to reformers (that is, the diminished capacity of politicians to bias or block court rulings, in particular, or law enforcement, in general). This contrast between the public officials' perceptions of their short-term costs and long-term benefits has proved to block judicial reforms and explains why court reforms, which eventually would benefit most segments of society, are often resisted and delayed. 4 In this context, court reforms promoting uniformity, transparency, and accountability in law enforcement would necessarily diminish the politicians' and court personnel's capacity to abuse their discretion, which translates into a loss of power and illicit rents in the short term. Reform sequencing, then, must ensure that short-term benefits to reformers compensate for the loss of discretionary powers previously enjoyed by public officials responsible for implementing the changes. That is, initial reforms should focus on the public officials' short-term benefits. In turn, court reform proposals generating longer-term benefits need to be implemented in the later stages of the reform process.
Unsurprisingly, periods of institutional crisis come hand in hand with a general consensus among public officials to reform the public sector. Within the judiciary, for example, a public sector crisis begins when backlogs, delays, and payoffs increase the public's cost of accessing the system to the extent that people restrict their demand for court services and question the legitimacy of judicial institutions. At that point, court officials increasingly embrace reforms in order to protect their institutional domain in the midst of public outcry. 5 The public agency would likely be willing to conduct deeper reforms during a crisis as long as reform proposals contain [End Page 138] sources of short-term benefits...