The New Comparative Law: A Legacy of Hernando de Soto, and Laporta, Lopez, Schleifer, Vishny and Djankov

The World Bank has just published a new report on doing business in 175 countries, examining regulation and regulatory reform in a number of areas.  The central concern of the report is cost-benefit analysis of regulation:  what types of regulation that seem to provide little benefit are most costly?  This report is a legacy of the early ideas of Hernando de Soto to the effect that government regulation sometimes suppresses enterprise without a good rationale.  It is also a legacy of the self-styled "new comparative economics," pioneered by LaPorta, Lopez, Schleifer and Vishny, and now a number of co-authors.  This new comparative economics should be understood as a new comparative law.  This new comparative law, albeit with lots of methodological problems, is certainly worth examining.  It seems helpful in pointing to types of regulation that seem costly, and that seem not to provide great prudential-type benefits.