Suing the government under weak rule of law: Evidence from administrative litigation reform in China

Abstract

There is a long-standing debate in the literature about the effectiveness of strengthening judicial independence in developing countries with weak rule of law. This paper exploits a recent Chinese judicial reform in administrative litigation, which changed the jurisdiction rule from intra-regional to trans-regional, to estimate the effects of improved judicial independence on protecting private entities against potential abuses of public authority. We find a significant increase in the probability of successfully suing local governments after the reform, especially when the defendants are more powerful government departments and when the plaintiffs are individual citizens with fewer legal resources than firms. But this effect is more limited for higher-level governments. The reform also results in increased case filings, prolonged trial time, and enhanced judicial quality. In addition, it raises the awareness of both governments and citizens about the rule of law, increases firm entry, and worsens general public attitudes toward local governments, at least in the short term. Our study highlights trans-regional jurisdiction as a new source of judicial independence in a party state and its potential limitations.