Judicial Independence, Judges' Incentives and Efficiency

Although often assumed by economic theory, the idea of an efficient judicial system often sounds like an oxymoron. In this work, we suggest an innovative approach to investigating the determinants of court performance. Our focus is on determining the ideal institutional environment for fostering the appropriate set of incentives for judges to operate efficiently. In this setting, we find evidence that greater independence enjoyed by the judiciary from politics induces more competition among judges to obtain professional upgrades. Such an environment will incentivize ambitious individuals to be more efficient, thus positively affecting the aggregate performance of the judiciary.