INCOMPLETE PROPERTY RIGHTS, REDISTRIBUTION, AND EFFICIENCY

J. Atsu Amegashie

No 705, Working Papers from University of Guelph, Department of Economics and Finance

Abstract: In a world where the private protection of property is costly, government redistribution can lead to an increase in aggregate output. I find that while redistribution increases aggregate output, it may make some members of the society worse off. The State may directly enhance economic rights through investments in security and the protection of property or it may indirectly do so through the redistribution of income. Indeed, under certain conditions, redistribution becomes desirable in situations where the State has exhausted its ability to enhance efficiency through the direct enforcement of property rights. In this case, redistribution can make all members of a society better off. Specifically, this occurs when the cost of predation is sufficiently low and the technology of private protection of property rights is sufficiently weak. The adverse effects of redistribution may be the consequence but not the cause of State failure. The real cause is a corrupt and inept State.

Keywords: efficiency; incomplete property rights; predation; production; redistribution. (search for similar items in EconPapers)
JEL-codes: D30 H10 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2007
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.uoguelph.ca/economics/repec/workingpapers/2007/2007-05.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gue:guelph:2007-5

Access Statistics for this paper

More papers in Working Papers from University of Guelph, Department of Economics and Finance Contact information at EDIRC.
Bibliographic data for series maintained by Stephen Kosempel ().