{"title":"Judicial Reform and Banks Credit Risk Exposure*","authors":"Giulia Canzian, Antonella Rita Ferrara","doi":"10.1111/obes.12652","DOIUrl":null,"url":null,"abstract":"<p>The aim of this paper is to examine the impact of the Judicial System Reform, which was introduced in Italy in 2012, on the efficiency of the judicial system and the exposure of banks to credit risk in terms of Non-performing loans. To this end, we apply a difference-in-differences approach, using a dataset that covers annual judicial proceedings from 2010 to 2017, supplemented by bank balance sheet data. Our findings indicate that the reform had a detrimental effect on both judicial efficiency and the NPL ratio. The negative impact is especially pronounced in courts that were previously more efficient, suggesting that the court mergers may have resulted in diseconomies of scale.</p>","PeriodicalId":54654,"journal":{"name":"Oxford Bulletin of Economics and Statistics","volume":"87 2","pages":"414-447"},"PeriodicalIF":1.5000,"publicationDate":"2024-12-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://onlinelibrary.wiley.com/doi/epdf/10.1111/obes.12652","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Oxford Bulletin of Economics and Statistics","FirstCategoryId":"96","ListUrlMain":"https://onlinelibrary.wiley.com/doi/10.1111/obes.12652","RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q2","JCRName":"ECONOMICS","Score":null,"Total":0}
引用次数: 0
Abstract
The aim of this paper is to examine the impact of the Judicial System Reform, which was introduced in Italy in 2012, on the efficiency of the judicial system and the exposure of banks to credit risk in terms of Non-performing loans. To this end, we apply a difference-in-differences approach, using a dataset that covers annual judicial proceedings from 2010 to 2017, supplemented by bank balance sheet data. Our findings indicate that the reform had a detrimental effect on both judicial efficiency and the NPL ratio. The negative impact is especially pronounced in courts that were previously more efficient, suggesting that the court mergers may have resulted in diseconomies of scale.
期刊介绍:
Whilst the Oxford Bulletin of Economics and Statistics publishes papers in all areas of applied economics, emphasis is placed on the practical importance, theoretical interest and policy-relevance of their substantive results, as well as on the methodology and technical competence of the research.
Contributions on the topical issues of economic policy and the testing of currently controversial economic theories are encouraged, as well as more empirical research on both developed and developing countries.