Question

How would you describe the relationship between property rights and GDP per capita? Why do you think that relationship exists?

Must be at least 150 words

Answer 1

Relationship: Direct and Positive

Explanation:

Per capita GDP demonstrates how much economic value of production can be attributed to each individual person. Conversely, this equates into a measure of national wealth, since market value of GDP per person is also readily used as a measure of prosperity.

Property rights are conceptual social constructions in economics to determine how a resource or economic good is being used and owned. Resources may be owned by individuals, associations, collectives or governments.

As GDP per capita increases in the economic system, the level of protection for property rights also goes up, and as GDP per capita begins to fall, the need to safeguard property rights also falls in the economy. GDP per capita analyses every economy's economic efficiency. The higher the economic performance, the more the rights to property protection there will be.

The greater the property rights set, the better the incentive to operate, save, spend and invest and so the more productive the economy's operation becomes. And the more efficiently an economy performs, the more demand it can create with any set of resources. So, it will lead to an increase in GDP per capita.

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