Study of Business Courts Impact on Business Performance

Professor Jens Dammann has analyzed the  relationship between business courts and business firm performance, and describes his method and results in this detailed article.

Professor Dammann gives a summary of his article here, where he states: “The results are broadly consistent with the claim that the creation of business courts benefits firm performance.  I find that the creation of business courts is associated with a 2.8 to 3.8 percentage point increase in firm performance as measured by return on assets.  Moreover, the creation of a business court is associated with a 0.3 to 0.5 percentage point higher likelihood of being the target in a completed takeover with positive abnormal returns for the target’s shareholders.  These results are both economically and statistically significant.”

A review of Professor Dammann’s article can be found here.