A Tale of Two Chinese Courts: Economic Development and Contract Enforcement

The way in which formal contract enforcement becomes effective is a critically important but understudied question for law and development studies. Primarily drawing on field investigations, this article compares the enforcement performance of two basic-level courts in China, one in a more-developed and the other in a less-developed region. The level of economic development is found to be crucial in contributing to the courts' performance. Unlike the court users in the less developed area, those in the more developed area become more market-oriented as the local economy diversifies, paving the way for more rigorous judgment enforcement; a developed local economy also allows the court to strengthen institutional building and staff professionalism. The comparison of the two Chinese courts provides empirical evidence with which to evaluate the relationship between formal contract enforcement and economic development.