Band 14, Heft 2 - Special Issue: Law and Development in High-Income Countries; Guest Editor: Hans-Bernd Schäfer

Economic development is the term that has been associated with less developed countries in the Third World (“developing countries”), not the economically advanced countries (“developed countries”), such as the United States. However, the changing economic conditions in recent decades, such as the widening income gaps among individual citizens and regions within developed countries, stagnant economic growth deepening economic polarization, and an institutional incapacity to deal with these issues, render the concept of economic development relevant to the assessment of the economic problems in developed countries. In the United States, these economic problems caused a significant political consequence such as the unexpected outcome of the presidential election in 2016. This article examines the applicability of the legal and institutional approaches, which were originally adopted to stimulate economic development in successful developing countries, to the economic problems in the United States.

The rule of law is not just a necessary condition for a modern liberal society but also an important prerequisite for a stable, effective and sustainable market economy. However, relevant legal norms may be more or less successful depending on their social reception within a particular country. This study explores the connection between the rule of law, especially in terms of how it is viewed socially, and the functioning of market economy in the examples of two geographically contiguous yet often-diverging countries, namely Germany and Poland. We utilise two approaches to examine this issue, first studying societal perceptions of the various dimensions of the rule of law by way of standardized surveys and in-depth interviews conducted in both countries to determine the de facto state of the rule of law in the economic context. Secondly, we measure the effect of the de jure and de facto rule of law on economic outcomes using a multivariate panel analysis. Combining new institutional economics and sociology of law, our analysis finds that Polish firms perceive the rule of law and its execution by the state in a restrictive perspective, contributing to insecurity. German interviewees, however, showcase the supportive and transaction cost-reducing properties of the rule of law, displaying higher trust in the state. These findings are supported by an econometric analysis of the drivers of rule of law in both Poland and Germany, which shows the importance of rule of law in terms of a level playing field contributing to higher levels of investment.

This paper examines whether there is a rule of law recession among member countries of the Organization for Economic Cooperation and Development (OECD). This formal inquiry is motivated by the recent findings of a democratic recession across several countries with a long tradition of democratic values. I conduct both quantitative and qualitative analyses using the rule of law index from the World Justice Project, as well as different government and academic reports. Results show that, by and large, there is no rule of law recession among OECD member countries. Findings indicate that 12 out of the 28 OECD member countries analyzed in this paper continue to expand their level of adherence to the rule of law during the period 2014–2020. In fact, just as many OECD member countries have stable scores in their respective rule of law index. In contrast, only Turkey, Hungary, Korea, and Poland exhibit a rule of law recession.

International financial centers (IFCs) provide means of strengthening law and regulation not only in the financial sector, but also in global governance more broadly and the contribution their legal regimes make to economic development. By demonstrating how ideas move across jurisdictions and how cross-jurisdictional structures add value, IFCs facilitate transactions in jurisdictions where local legal systems and services are not yet adequately developed or available to support economic activity. They serve as regulatory capacity builders, building networks of professionals, regulators, and judges contribute to ongoing innovation and capacity building. Their success at building legal regimes that add value and which are available to new classes of individuals and firms around the world makes them a model for using the legal system to foster economic development.

The current radical strategies by which there is, on one hand, an increasing European assistance to developing poor countries of Africa/Middle East and on the other hand, tightened border-security within Europe as a means to reduce migration from the South; may worsen the state of poverty in Europe, particularly on the immigrants and impact on the workforce in Europe with implication on development. Though, these strategies may sound radically appealing, they are however, unlikely to reduce migration flows to Europe. While there is still a “wide development gap” between the poor countries of Africa/Middle East and industrialised countries of Europe, migration will often increase, at least in the next two-three decades. Radical border security in Europe will expose the migrants to human trafficking in different form and manifestation contrary to Article 3 UN Protocol on Trafficking in Person. The paper examines the role of the State and Law and development, in addressing the issues of poverty and migration within the industrialised countries of Europe. The research argues that there is the likelihood that poverty and human right issues will increase in Europe in the near-future, if the State/EU fails to play their role, by changing their policy direction and repositioning themselves by improving their Law and development stance. The research employs the human rights-based approach, interdisciplinary and critical-analytical perspective within the framework of international Law and development. It employs qualitative empirical evidence from developed countries of Europe and poor developing countries for analysis.

Agenda 2030 on sustainable development promotes a holistic approach to development and emphasizes the need to leave no one behind. Regarding the rule of law, sustainable development goal (SDG) 16.3 focuses on (promoting the rule of law at the national and international levels and ensure equal access to justice for all by 2030) and the related goals and targets on justice. Changing economic conditions in recent decades have caused stagnating wages and widening economic gaps among individual citizens and regions within developed countries and this is reflected in pockets of poverty and inequality in high income countries and islands of excess wealth in developing or low-income countries, worsened by the COVID-19 pandemic. This paper examines the legal aspects of poverty and inequality in the education and health sectors in select high-income countries in sub-Saharan Africa and a Western industrialized country such as the UK, with emphasis on period poverty or poor menstrual health management (MHM) as a barrier to access to education and health due to inability to afford sanitary products. The analytical paper applies the institutionalist legislative theory and methodology (ILTAM) and the general theory of law and development, examines the role of the state in regulating the health and education sectors and concludes with key findings and recommendations on how the institutional and legal frameworks can be utilized to foster sustainable development in high-income countries in sub-Saharan Africa.

The argument in this paper is that international lawyers—scholars and practitioners alike—should be cognisant of the fact that different economic distributions within nations will lead to the establishment of different international legal systems in terms of their formation and evolution, as well as in relation to the extent to which they are respected and adhered to. Rising economic inequality within nations is an issue of incredible systemic importance to international law; it should be pushed further up the agenda when it comes to devising the laws between them because this will, on balance, assist in creating a more peaceful and prosperous world underpinned by an effective law of nations that is up to the types of contemporary challenges which of necessity require more cooperation between states. Accordingly, from the perspective of this paper, international lawyers should, at a minimum do the following (i) give consideration to the direction of distributional trends within nations when attempting to understand how current international law works (i.e. how it formed, evolves and the extent to which it is respected and adhered to); (ii) give consideration to these same trends when conceptualising and designing the international law(s) of the future and (iii) to the extent necessary, think about the development of the mechanisms at the international law level that encourage and enable the reduction of economic inequality within nations with a view to ensuring that the better functioning, at a systemic level, of the international legal system in general, as well as the various parts of which that system is comprised.

Gender equality and women’s empowerment is taken as an important precondition and driving force for the achievement of all the Sustainable Development Goals (SDGs). Despite its highly developed economy and democratic governance system, Japan’s record of gender equality, in particular, women’s political and economic leadership, has stalled for a number of years. Even after the promulgation of laws for promoting economic and political participation and leadership of women, namely, the Act on Promotion of Women’s Participation and Advancement in the Workplace (2015) and the Act on Promotion of Gender Equality in the Political Field (2018), Japan’s global ranking on gender equality was lowered further by a widening of the political gender gap and remaining dearth of female managers. This study analyses the effectiveness of the legal frameworks aimed at improving gender equality, through assessing their regulatory design, compliance, and implementation. It also highlights how gender norms underlining the international human rights law and international development agenda have affected the development and implementation of those legal frameworks. The paper concludes that the laws aimed to promote women’s leadership in the economic and political spheres have not fully performed to achieve intended goals because of their weak enforcement mechanism, the lack of strong political will as well as insufficient awareness raising and advocacy to bring about transformative changes of gendered practices embedded in social context and practice. The partnerships among global and local stakeholders including international organisations, governments, business, media, civil society, and people with diverse backgrounds are essential to provide the necessary momentum to drive the laws to work effectively on the ground, through transnational and local advocacy. Japanese society is standing at a critical juncture to advance equal voice in economic and political decision making, which is a core of democratic governance and sustainable development based on the principle of leaving no one behind.

This article explains how corruption, money laundering, and terrorist financing could be addressed through an Anticorruption Protocol to the United Nations Convention against Corruption (APUNCAC). APUNCAC seeks to establish United Nations inspectors, dedicated anticorruption courts, and aggressive measures to fight corruption, including requirements to obtain and report accurate beneficial owner information when funds are transmitted internationally. This information is needed to deter money laundering. APUNCAC would allow private litigants to commence a Racketeer Influenced and Corrupt Organizations (RICO) civil action and recover three times the amount of their damages. These provisions create financial incentives for private litigants to fight corruption through civil actions. The provisions leverage private interests and align these interests in the fight against corruption. APUNCAC also includes treaty provisions designed to ensure that APUNCAC is implemented as intended. This article addresses the issue of complementarity. APUNCAC is designed to complement, rather than replace, existing domestic institutions.

The paper focuses on rules of standing in the context of environmental law. With the implementation of the Convention on Access to Information, Public Participation in Decision-making, and Access to Justice in Environmental Matters (Aarhus Convention) in European law, interest groups have become major players in the enforcement of environmental regulations. Although such interest groups can help to reduce enforcement deficits, their involvements create the risk of regulatory gridlock, with excessive litigation lengthening approval processes which can discourage investment in public and private infrastructure. The paper discusses the implementation of the Aarhus Convention in Germany, highlights ways to overcome administrative gridlock and facilitate effective approval procedures. If implemented, these strategies will enable Germany’s economy to remain competitive, supporting the maintenance of the country’s high standard of living and strong welfare state.

Among wealthier, so-called “developed” nations, a consistent and shared policy orientation on trade has generally prevailed over the last three quarters of a century. This consensus has been hallmarked by the promotion of freer trade facilitated by a state-centric, rules-based legal system. While most wealthy countries appear to desire a continued fidelity to that policy orthodoxy, the United Kingdom’s (UK’s) ‘Brexit’ decision and the United States’ (US’) increasingly antagonistic stance toward World Trade Organization (WTO) dispute settlement beg the question as to whether fissures in the consensus are forming. This paper examines the depth of the perceived consensus and the degree to which US and UK actions signify a turning point. As part of this examination, populism’s role in promoting change in the US, UK and beyond, is explored.

The Bayh–Dole Act was enacted in the United States in 1980 to promote economic development and growth at regional and national levels. A key engine is research generated within universities. This article addresses the question of how universities can serve as engines of development. Drawing on Cooter and Shaeffer’s work on law and development, specifically what they call the double trust problem, this article shows how the Bayh–Dole Act was justified as resolving the double trust problem arising from lack of property rights in university research. This article presents the argument that this goal of the Bayh–Dole Act ignores how universities solve another dimension of the double trust problem, namely the generation of human capital. The author examines the theoretical justifications for the Bayh–Dole Act and universities and the empirical policy literature assessing university patenting and commercialization in the United States, South Africa, and India.

Corporate executive compensation in Canada, as in many developed economies, has risen significantly since the 1980s relative to that of the average worker. This has posed an issue for corporate governance due to concerns that the trend may not be serving the corporation and its stakeholders well, and also an issue for society as a whole due to its impact on income inequality more generally. This has raised interest in the role played by institutions in shaping executive pay decisions and also in what role they might play in resolving these issues. This paper looks at the role played by one such institution, the courts, with two ends in mind. The first is to gain an empirical understanding of what the courts actually do with respect to executive pay disputes. It does so by examining a set of decisions by Canadian courts between 1876 and 2018 collected by the author in which the claim of a corporate executive to their pay was at issue in order to get a better picture of how the courts are accessed, who relies on them, what rules they use, how the courts respond and how trends in these have evolved over time. It finds that the litigation of executive pay disputes has varied widely over time with a variety of stakeholders using a variety of legal areas – corporate law, contract law and bankruptcy/arrangement law in particular – to dispute the entitlement of executives to their pay. In recent years however litigation has come to be dominated by oppression remedy applications, with plaintiffs being successful in challenging pay in a majority of decisions. This paints a significantly different picture of the role of the courts than that developed in the American literature which focuses almost exclusively on shareholder use of derivative actions to monitor pay decisions. The second is to examine how better use might be made of the courts in order to remedy the broader problems for corporate stakeholders and society as a whole that corporate executive pay practice presents. It suggests that an expanded role for the oppression remedy by corporate employees should be considered as a policy option which would better reflect a stakeholder model of governance and address broader inequality concerns at the same time.