Question

How does property rights protection affect economic development? Give a real example on this. According to the “social conflict view”, why some countries have protective property rights institutions but others not?

Answer 1

Property right protection affect economic development because its aim is to harmonize standards of intellectual property between signatory countries.in order to be part of the wto and to benefit from the advantages of free trade ,developing countries were requested not only to enforce IPRS protection but also to make their Iprs system conform to specific standard operating in developing countries.

The protection and enforcement of intellectual property right should contribute to the promotion of technological innovation and to the transfer and dissemination of technology to the mutual advantage of producers and users of technological knowledge and in a manner conducive to social and economic welfare and to a balance of right and obligation.

In the real world contracts are incomplete and hence it is impossible to contractually specify what decision will have to be taken in any conceivable state of the world.there will be renegotiation in the future so parties have insufficient investment incentive.this is hold up problem.hence property right matter because they determine who has control over future decision if no agreement will be reached.