Prosperity Follows Not From Privileges Nor From Predation But From Protection Of Property Rights

|Peter Boettke|

Generations of students -- from Econ 100 to Econ 999 -- have heard me talk about the 3 p's and the 3 i's.  Property, prices and profit/loss generate incentives, information and innovation.  But I never produced an animated version of this mnemonic device.

There is a pretty neat animation for Why Nations Fail, which gets at the idea that the wealth of a nation follows from the establishment of political institutions that neither provide special privileges to an elite few nor reward predation by either private or public actors.  Good political institutions protect property rights, ensure competition in economics and politics, and result in generalized prosperity throughout the population.

 

I'd like to see someone produce an animated summary of Living Economics.  In the meantime, you can see a video podcast with Jeff Tucker at LFB.

Comments

[Allan Walstad]

When an island was shown being split down the middle, it looked just like Haiti and the Dominican Republic, but the example given was N & S Korea. I thought the animation quit rather abruptly.

I also watched Acemoglu's interview with the Economist. Near the end he runs off the rails with this notion that the wealthy are gaining political power (with negative economic consequences to follow) because they are the only ones with the money to push their views. As we well know, however, organizations exist for the pooling of many smaller contributions into an effective political voice. The NRA is a good example, and it is organizations like the NRA that "progressives" would like to shut up through government regulation of political speech. Down through history, I suggest that the examples of political power flowing to the wealthy are dwarfed in number and significance by the cases of wealth flowing to the politically powerful. Look at feudalism. Look at the old Soviet Union. Look at any number of petty tyrannies around the world.

[Bob Subrick]

I thought there were 4 P's- prices, profits, property rights, and politics.

[Bill Stepp]

Far from defending property rights, all political "institutions" attack them by using the political means. It's just a matter of time before the criminal entity at Washington is aa corrupt as the political entity at Athens.
He who says Constitution eventually says leviathan, war, mass murder, and other unpleasant things.

[Michael G Heller]

"Generations of students -- from Econ 100 to Econ 999 -- have heard me talk about the 3 p's and the 3 i's. Property, prices and profit/loss generate incentives, information and innovation."

You mean in all those years you never taught them the 'i' of INSTITUTIONS? I find that hard to believe. Perhaps it was just that you had no adequately theorised conception of institutions to present to your students?

The problem with Why Nations Fail is that it is poorly theorised:

http://www.project-syndicate.org/blog/the--poor-economics--in--why-nations-fail-

Perhaps it is even un-theorised.

[Peter Boettke]

No Michael, lots of talk about institutions goes on at GMU. Take a look around at the courses and cv's of the faculty. It is filled with work on exchange and the institutions within which exchange takes place.