Tag
rule_of_law
4 findings
Firms & operationsOwner Time-Constraint Bottleneck via Centralized Decision-MakingDeveloped-country plant managers can make capital investments averaging $50,000 without higher authorization, whereas developing-country owners sign off on minor $25 purchase orders; the number of owner brothers and sons directly predicts firm size due to selective family delegation.Observational StudyEconomics (general)Rule-of-Law Deficit and Expropriation FearDeveloping nations with weak legal enforcement display near-zero delegation of employment, capital investment, and pricing decisions compared to developed nations where plant managers independently approve up to $50,000 in capital expenditures.Observational StudyFirms & operationsLegal Enforcement Deficits and Decentralization Barriers100% of surveyed firms were family-owned and managed; zero non-family managers held financial or procurement decision-making authority prior to management practice interventions.Observational StudyFirms & operationsRule of Law Infrastructure and Managerial Expropriation RiskWeak legal enforcement directly inhibits decentralization, as owners refrain from granting operational autonomy due to fear of unpunished theft, keeping managerial decision-making highly centralized compared to developed nations.Observational Study