Conflict, Growth and Welfare: Can Increasing Property Rights Really be Counterproductive?

Aynur Alptekin and Paul Levine ()

No 109, School of Economics Discussion Papers from School of Economics, University of Surrey

Abstract: Gonzalez (2007), JET, 137(1), 127-139, sets out a growth model with con- flict in which households allocate their resources across consumption, and investment in both productive and unproductive capital. A striking result is obtained: there are circumstances where increasing property rights in society can actually reduce social welfare and hence incremental changes are not nec- essarily in peoples’ interests. This note reassesses this claim in a generalized form of his model with a CRRA utility function (with a risk aversion param- eter, sigma > 1 rather than his logarithmic form) and we assume a less than full depreciation of capital. Both these generalizations prove to be critical ones that significantly change the result.

Keywords: Conflict; growth; property rights; welfare. (search for similar items in EconPapers)
JEL-codes: D23 O10 O40 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2009-04
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:sur:surrec:0109

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