The Enforcement of Property Rights and Underdevelopment

September 1, 1999

Preview Citation

Format: Chicago

Era Dabla-Norris, and Scott Freeman. The Enforcement of Property Rights and Underdevelopment, (USA: International Monetary Fund, 1999) accessed September 20, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper formalizes the role of legal infrastructure in economic development in a general equilibrium model with endogenously determined property rights enforcement. It illustrates the mutual importance of property rights protection and market production by the model’s multiplicity of equilibria. In one equilibrium, property rights are enforced and market activity is unhampered. In the other, property rights are not enforced, which discourages economic activity and leaves the economy without the resources and incentives to enforce property rights. Even identically endowed economies may therefore find themselves in very different equilibria.

Subject: Consumption, Legal support in revenue administration, Productivity, Tax incentives, Technology

Keywords: Economic activity, Expected return, WP

Publication Details

Pages:

22
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 1999/127
Stock No:

WPIEA1271999
ISBN:

9781451854961
ISSN:

1018-5941

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