> Just look at where US treasuries compared with European bonds to compare which countries/continents are viewed as having less legal risks.
To be fair, you're comparing apples to oranges. Government bond prices reflect the default risk of the government in question. 'Legal risks' include things like getting sued because of perceived defects of your product. Some statistics about that would be interesting, but probably vary greatly by sector: medical devices probably involve lots of ass-covering, whereas something like paper notebooks probably incur fewer lawsuits.
To be fair, you're comparing apples to oranges. Government bond prices reflect the default risk of the government in question.
They also reflect overall competitiveness of the country in question which by definition includes legal risks. This is primarily driven from currency fluctuations. In Europe, the German Bund is currently priced stronger than Spanish bonds which is due to default risk.
If each country had their own currency (compare US to Europe as a whole), the bigger fear would not be default risk, it would be inflation risk. This inflation risk is a function of competitiveness.
'Legal risks' include things like getting sued because of perceived defects of your product. Some statistics about that would be interesting, but probably vary greatly by sector: medical devices probably involve lots of ass-covering, whereas something like paper notebooks probably incur fewer lawsuits.
I agree with your assessment of what legal risks are, but keep in mind it is more to do with the change in legal structures rather than current legal structure. If there is no change, businesses can make projections and be confident in them. If there is a risk of change, that is perceived as a larger legal risk.
I don't have statistics, but I would say that a country (France) which elects a president that is perceived as socialist (radical change from previous president) has far more legal risks than the relatively stable US.
I think the OP was talking about the costs of lawsuits and their effects on business, not risk of doing business in general in various places.
Also: I don't think that, in the context of France, the change in presidents is really all that radical. I suppose I could be proven wrong, but I don't see them as being that much further apart than, say, GWB and Obama, even if the latter two are shifted 'rightwards' compared to what the center is in France.
To be fair, you're comparing apples to oranges. Government bond prices reflect the default risk of the government in question. 'Legal risks' include things like getting sued because of perceived defects of your product. Some statistics about that would be interesting, but probably vary greatly by sector: medical devices probably involve lots of ass-covering, whereas something like paper notebooks probably incur fewer lawsuits.