Mostly summarized from Gregory Mankiw’s Principles of Economics, 5th Ed.

PART 9 The Real Economy in the Long Run
Chapter 25 of 36 Production and Growth
Section 16 of 23
…
Things government can promote and strengthen to increase productivity and living standards include
1· saving and investment
2· investment from abroad
3· education
4· health and nutrition
5· property rights and political stability
6· free trade
7· research and development
8· population growth
…
5· Property rights and political stability
An important requirement for the economy to work is respect for property rights.
Production in market economies results from interactions of millions of individuals and firms.
When you buy a car, you are buying the output of these and more
· a car dealer
· a car manufacturer
· a steel company
· an iron ore mining company
This division of production allows the economy's factors of production to be used as efficiently and effectively as possible.
…
Property rights are the ability of people to have authority over the resources they own.
A mining company will not mine iron ore if it expects the ore to be stolen.
The company mines the ore only if knows it will benefit from subsequent sale of it.
Courts and the criminal justice system serve an important role in a market economy, they
· enforce property rights
· discourage direct theft
· ensure buyers and sellers adhere to contracts
…
Property rights are taken for granted in developed countries.
But in less developed countries lack of property rights is a major problem.
In many less developed countries, often
· contracts are not enforced
· fraud goes unpunished
· government itself infringes on property rights
In some countries firms must bribe government officials to do business, this corruption
· impedes the coordinating power of markets
· discourages domestic saving and investing
· reduces investment from abroad
…
Another threat to property rights is political instability.
When revolutions and coups are likely there is doubt about future protection of property rights hindering saving and investment and depressing a nation's economy and standard of living.
Economic prosperity depends in large part on political prosperity.
A country with an efficient court system, honest government officials, and an enforced constitution will have a higher standard of living than a country with a poor court system, corrupt officials, and frequent revolutions and coups.
…
frequent revolutions and coups
hinpan'na kakumei to kūdetā
頻繁な革命とクーデター

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