Property rights linked to economic security?

Countries that protect the physical and intellectual property of their people enjoy nearly nine times higher gross domestic product per capita than countries ranking lowest in property rights protections, according to the "2009 International Property Rights Index (IPRI). The study compared the protections of physical and intellectual property to economic stability in 115 countries representing 96 per cent of the world's gross domestic product (GDP).

The 2009 IPRI is a composite ranking of three comprehensive areas of property rights: Legal and Political Environment, Physical Property Rights, and Intellectual Property Rights:

Of the 115 countries included, the top quartile averaged $39,991 in GDP per capita while the average in the bottom twenty per cent was only $4,341 per capita.

The second, third and fourth quartiles averaged $23,982, $11,748, and $4,891 respectively.

The nearly linear data trend shows that countries placing a high priority on property rights see increased economic security.

"With regard to private property rights, PRA continues to champion the idea that physical and intellectual property are equally important in nature, and must be protected" states Kelsey Zahourek, PRA executive director. "Property rights contribute to increased levels of stability and provide people with the knowledge and comfort that their property will remain theirs."

Hernando De Soto said this year's results "continue to point out the relationship between a strong property rights system and a country's economic well-being, revealing that much still needs to be done to extend property rights to more people, especially the poor."

Source: Anne Chandima Dedigama et al., International Property Rights Index: 2009 Report, Property Rights Alliance, February 24, 2009.

For text: http://internationalpropertyrights.org/atr_Final1.pdf

For more on International Issues: http://www.ncpa.org/sub/dpd/index.php?Article_Category=26

FMF Policy Bulletin/ 17 March 2009