If property rights are not clearly defined and enforced, then
A) incentives for specialization based on comparative advantage are weakened.
B) resources are devoted to protecting possessions rather than to production.
C) some potential gains from specialization and trade are lost.
D) All of the above answers are correct.

Question

Quizplus · Accepted Answer

All of the above answers are correct. When property rights are not clearly defined and enforced, it leads to weakened incentives for specialization based on comparative advantage, resources being diverted to protect possessions rather than production, and some potential gains from specialization and trade being lost.

If Property Rights Are Not Clearly Defined and Enforced, Then