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Legal Self-efficacy and its Latent Causes: Human Legal Capital, and Access to Information
Stockholm University, Faculty of Social Sciences, School of Business.ORCID iD: 0000-0002-7908-3958
2008 (English)Conference paper (Other academic)
Abstract [en]

This study reveals that legal self-efficacy as well as access to and search for internal and external information concerning business risks each bring a significant reduction of business risk in two separate but interrelated channels. The direct channel of risk mediation is that of legal self-efficacy, while the indirect channel of risk mediation is that of information acquisition from texts, media and human sources. Both channels confirm previous findings by Jörgensen (2008) and Cho and Lee (2006). The results indicate that risk reduction can be achieved not only through legal human capital but also through behaviour related to the search for and finding of information. Previous research on contractual assurance and risk reduction has focused on the improvement of legal institutions such as courts and legal texts to address the problem of contractual assurance. This study takes an opposite approach of addressing the legal consciousness and behaviours of the end users of law. The policy implications are that managers can be taught to improve their legal self-efficacy or they can use risk-reducing behaviour to mitigate business risks.

Place, publisher, year, edition, pages
, Svenska Nätverket för Europaforskning i Ekonomi
Keyword [en]
legal self-efficacy, human legal capital, business risk, framing
Keyword [sv]
rättssjälvtillit, humant kapital, humant rättskapital, affärsrisk, inramning
National Category
Economics and Business
Research subject
Business Administration; Private Law
URN: urn:nbn:se:su:diva-98054OAI: diva2:682266
Svenska Nätverket för Europaforskning i Ekonomi
The Foundation for Baltic and East European Studies
Available from: 2013-12-26 Created: 2013-12-26 Last updated: 2014-01-10Bibliographically approved
In thesis
1. The Law BusinessmanTM: Five Essays on Legal Self-efficacy and Business Risk
Open this publication in new window or tab >>The Law BusinessmanTM: Five Essays on Legal Self-efficacy and Business Risk
2013 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

The thesis challenges the notion of effectiveness of law as being based on the formal institutions of courts, law enforcement and written law. It argues that the best way to measure the effectiveness of law is the legal self-efficacy of laymen who are the end users of law.  It presents a new perspective on the effectiveness of law. It turns the traditional perspective of studying the effects of legal institutions around and instead studies the effect of how individuals perceive their own ability to use law. This self-reflexive ability - legal self-efficacy -  is the answer to the question “How comfortable are with communicating with legal terminology?”. The thesis makes several comparisons using the traditional perspective and legal self-efficacy and finds that legal self-efficacy is a better measure of legal effectiveness.

This thesis analyzes 246 businesspeople in Russia and their risk behavior  with regards to economic transactions in relation to legal self-efficacy.  The theory behind legal self-efficacy is a combination of Luhmann’s theory of law as communication and Bandura’s concept of self-efficacy.  The first paper applies the traditional approach. It analyzes the effect of legal efficiency on leverage and debt maturity for listed and non-listed companies. The second paper is describes the conceptual foundation of the legal effectiveness based on the individual. The third paper compares the effect of private order (including legal self-efficacy) and public order institutions on the granting of trade credit.  The fourth paper analyzes the impact of legal self-efficacy and formal legal institutions on sanctions against clients in a comparative perspective. The final paper seeks out possible sources of legal self-efficacy.

Legal self-efficacy can be used to better understand the interaction of individuals and law including such fields of research as behavioral accounting, behavioral law and finance, legal sociology and legal studies. 

Place, publisher, year, edition, pages
Stockholm: School of Business, Stockholm University, 2013. 88 p.
legal self-efficacy, legal effectiveness, legal terminology, trade credit, institutional effectiveness, mechanisms of risk reduction, public order, private order, legal family, leverage, long term debt, legal efficiency, trade sanctions, debt maturity, creditor rights, corporate governance, Luhmann, Russia, Central and Eastern Europe, legal sociology, law and finance, law and economics, legal studies, legal consciousness, self-efficacy, rättssjälvtillit, rättseffektivitet, kreditrisk, handelskredit, sanktioner, institutionell effektivitet, redovisningssjälvtillit, riskreduceringsmekanismer offentliga och privata, rättsfamilj, handelssanktioner, långsiktiga skulder, kortsiktiga skulder, borgenärsrättitgheter, handelssanktioner, corporate governance, Luhmann, Ryssland, Central och Östeuropa, rättssociologi, rätt och finans, rättsekonomi, juridik, rättsmedvetandet, självtillit
National Category
Business Administration
Research subject
Business Administration
urn:nbn:se:su:diva-97625 (URN)978-91-7447-812-9 (ISBN)
Public defence
2014-01-24, Gröjersalen, hus 3, Kräftriket, Roslagsvägen 101, Stockholm, 13:00 (Swedish)
Available from: 2014-01-02 Created: 2013-12-16 Last updated: 2014-01-14Bibliographically approved

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