Institutions that encourage productive activities and discourage counterproductive ones, will tend to promote
A) economic growth.
B) rent-seeking
C) economic fluctuations
D) high rates of unemployment.

Question

Quizplus · Accepted Answer

Institutions that promote productive activities will result in more efficient use of resources, leading to increased economic growth. Conversely, institutions that discourage productive activities and encourage counterproductive ones will lead to inefficiencies and economic stagnation. Rent-seeking and economic fluctuations are likely to be promoted by weak or ineffective institutions, while high rates of unemployment can also result from counterproductive policies and lack of incentives for productive activities.

Institutions That Encourage Productive Activities and Discourage Counterproductive Ones, Will