Property Rights, Predation, and Productivity

Fernando del Río

MPRA Paper from University Library of Munich, Germany

Abstract: We develop a neoclassical growth model with imperfect property rights in which predation entails both waste of resources and deadweight losses, the latter becoming very large when the predation rate is high. According to the model, in the United States, the welfare costs of crime represent a loss of 18.6% of consumption per capita. For a country in the average of the last decile of the distribution of an index of business costs of crime across 94 countries, this loss is 57.8%. Moreover, a one standard deviation increase in the quality index of formal institutions securing property rights increases GDP per worker by 23% for a country with an institutional quality index equal to the average of the last decile of its distribution.

Keywords: Rent-seeking; cross-country differences in TFP and GDP per worker; business costs of crime; institutional quality; welfare costs of crime. (search for similar items in EconPapers)
JEL-codes: O10 O4 O43 (search for similar items in EconPapers)
Date: 2018-02-13
New Economics Papers: this item is included in nep-gro, nep-knm and nep-law
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Property Rights, Predation, and Productivity (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:86246

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