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Insecure Property and Technological Backwardness

19 Pages Posted: 22 Jul 2005  

Francisco M. Gonzalez

University of Calgary - Department of Economics


We consider the incentive to adopt superior technologies when private property is insecure. The welfare costs of insecure property can be substantially greater than those commonly associated with diversion and with the disincentive effect induced by imperfect appropriation of returns. When private property is sufficiently insecure, anticipation of conflict over economic distribution gives rise to technological backwardness, even though (1) superior technologies are readily available at zero cost and (2) the ex post diversion of resources might be small.

Suggested Citation

Gonzalez, Francisco M., Insecure Property and Technological Backwardness. Economic Journal, Vol. 115, No. 505, pp. 703-721, July 2005. Available at SSRN: https://ssrn.com/abstract=760516

Francisco M. Gonzalez (Contact Author)

University of Calgary - Department of Economics ( email )

2500 University Drive, NW
Calgary, Alberta T2N 1N4

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