Principles of Macroeconomics / Unit 4 MAC 0317 short lesson, about 20 seconds
Institutions, the Rule of Law and Property Rights
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The idea
Institutions are the laws and traditions by which a community governs itself. The rule of law means laws that are clear, public, fair, enforced, and applied to everyone.
In practice
Property rights let owners use what is theirs; contractual rights make agreements enforceable.
Where people slip
Without enforcement, trade and investment shrink, because nobody commits resources they may not be able to keep.
Your place on the trail
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