Research

Abstract: This paper proposes that the failure of institutional transplants may stem from an 'institutional mismatch' between rigid formal rules and informal norms. Leveraging a spatial regression discontinuity design across partitioned ethnic homelands, I find that historical kinship intensity impedes development only under Civil Law. This institutional mismatch reduces local economic activity by 11% and aggregate GDP by 4%. I identify a key mechanism using geocoded microdata: under Civil Law, high-kinship groups view the state as illegitimate and withdraw from the formal sphere. Using NLP on a novel corpus of colonial court cases, I show that Common Law can absorb customary norms, mitigating these costs. To address colonial strategy as an alternative explanation, I exploit a real-time shock in institutional mismatch during the 2016 Anglophone Crisis in Cameroon. The imposition of Civil Law triggered civil disobedience that reduced economic activity four times as much in high-kinship communities. Institutional efficacy may depend on aligning formal policies with local moral psychology.