Question

Property rights are important institutions for encouraging investment because:

A. they tend to support industrial sectors more than agricultural sectors.
B. people won't invest if they feel their property is at risk and that they may not realize a return on their investment.
C. they increase the average return to investing, thus increasing the overall level of investment in the economy.
D. they eliminate corruption.

Answer 1

D. they eliminate corruption.

Step-by-step explanation:

• A property right is a theoretically induced and socially-enforced constructs for determining how an economic good or resource is owned. They can be owned by the individual, organizations, and governments and is also referred to as a bundle of rights.

• As property rights are defined must be monitored and enforced which is termed as the transactional costs.

• As ts closely related to the political order due to the protection of claims form the economic rents, particularly legal and political systems protect these claims and others are denied access to political power and privileges.