Property Rights Literature Review

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Literature Review Recently, numerous papers have established that Property rights encourage financial development which further depends on institutional characteristics, including legal, political, and economic frameworks as well. For Pipes (1999), Hayek (1944) and O’Driscoll Jr & Hoskins (2003), property “provides the base for the emergence of political and legal institutions that guarantee liberty.” It means that property rights are the needed condition for political and social freedom as well. It can easily be observed in Russian history that there was no distinction between sovereignty and property. (23) It is now well-recognized by many scholars (La Porta et al. 1997, 1998; Acemoglu et al. 2001, 2002; Engerman and Sokoloff 1997, 2002;…show more content…
They tried to understand the causes of the industrial revolution in England and then its geographic spread within Europe. They linked England’s first start was due to the Glorious Revolution of 1688, which limited the politically authoritative power of the Crown and strengthened the individuals’ rights in terms of freedom and private property. According to them, this commitment to individuals’ property rights reduced interest rates on public and private investments which developed the building blocks of industrialisation in England.] (North )1990(, North and Weingast )1989[(. But the available data to confirm this linkage is modest. (24) Walter Bagehot (1873) and John Hicks (1969) also explained this that property rights played a very critical role in stirring the industrial revolution in England by encouraging the mobilisation of capital for “immense…show more content…
It minimises the workload of the courts to settle property disputes and increase the creditworthiness of small farmers. Similarly, it also generates Government’s revenue in the form of tax and reduces the cost and time overruns in development projects and property acquisition. So, by these ways, property rights have an inverse relation to the transaction cost Khan (2006) and they increase efficiency [Demsetz (1967)]. Developing countries’ property rights system has several loopholes in their property right system through which big landlords with the help of corrupt bureaucracy and politicians avoid or evade taxes and create a scenario in which the politically weak people remain disadvantageous having less secure property rights. For example, Khan (2006) reported several cases of corruption in the Pakistan. Corrupt government personals asked for a bribe to issue allotment letter, accessing a file, giving NOC and other legally required documents even for an already purchased

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