Legal institutions of the market economy: private commercial arbitration as transaction costs reducer in Colombia

UnrestrictedThis thesis analyzes legal and institutional responses to economic liberalization in Colombia. The main hypothesis is that the increasing use of alternative dispute resolution mechanisms (ADRMs) by economic agents is the consequence of global economic pressures, as well as an attempt to address the crisis of the national judicial system. ADRM’s reduce economic transaction costs, and offer more efficient, predictable, and independent venues for resolving litigation. Consequently, they create a more stable environment for investors. This, in turn, suggests that the relationship between law and economics is rapidly changing at the structural level in Colombia.; this latter point constitutes a secondary hypothesis, wherein market-friendly governance structures guided by private interests are displacing those dominated by the state.; The analysis goes beyond the macro cross-national indices mainstream approach to understanding the relationship between legal institutions and economic interests. The analysis favors a micro case studies approach to better comprehend that interconnection. It analyzes 112 actual arbitration cases heard before the Center for Arbitration and Conciliation, CAC, of Bogotá Chamber of Commerce, between 1985 and 2007