Question

What characteristics do the “industrialized” economies of the G-8 tend to share with one another? Why do economists think that private property laws lead to economic growth?

Answer 1

Common characteristics of the “industrialized” economies of the G-8

1. Economic growth
2. Efficient division of labour
3. Technological innovation
4. Increased personal liberties
5. Improved standards of living
6. Economic freedoms/property ownership

Why do economists think that private property laws lead to economic growth?

Economist say that the stronger the private property laws the system is the better the economy is performing. This is because resource allocation in this economy is efficient and it leads to expansion of wealth creating opportunities. Private property also creates competition which resolves the problem of conflicts of interest among individuals for a better economy.

References

The Cato Institute (2020).Property Rights: The Key to Economic Development. Policy analysis NO 482 . Retrieved December 24, 2020, from https://www.cato.org/publications/policy-analysis/property-rights-key-economic-development