INTERNATIONAL PROPERTY RIGHTS INDEX - Liberales Institut · • The Free Market Foundation, South...
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COVERING 98% OF WORLD GROSS DOMESTIC PRODUCT AND 93% OF WORLD POPULATION
Study by DR. SARY LEVY-CARCIENTE
2017 Hernando de Soto Fellow
With Contributions by: Prof. Cesare Galli, Esteban Gonzalez
INTERNATIONAL
PROPERTY RIGHTS INDEXExecutive Summary
INTERNATIONAL PROPERTY RIGHTS INDEX | 2017 REPORT
2017 IPRI PARTNER ORGANIZATIONS
AfghanistanEconomic and Legal StudiesOrganization,Afghanistan • Foundation for Economic Freedom,Albania • FundaciónAtlas 1853,Argentina •FundaciónBases,Argentina •FundaciónLiberdadyProgreso,Argentina •FundaciónLibertad,Argentina •InstituteforPublicAffairs,Australia •MannkallEconomicEducationFoundation,Australia •MyChoice,Australia •AustrianEconomicsCenter,Austria •F.A.v.HayekInstitute,Austria •TheNassauInstitute,Bahamas •NewDirection,Belgium •CPA,BosniaandHerzegovina •Multi,BosniaandHerzegovia •Populi,Bolivia •InstitutoLiberdade,Brazil •CentroMackenziedeLiberdadeEconômica,Brazil•InstituteforMarketEconomics,Bulgaria•CentreDesAffairesHumaines(CEDAH),BurkinaFaso•FrontierCentreforPublicPolicy,Canada•MacdonaldLaurierInstituteforPublicPolicy,Canada•FundaciónparaelProgreso,Chile•LibertadyDesarrollo,Chile•InstitutoResPublica,Chile•CathayInstituteofPublicAffairs,China•UniruleInstituteofEconomics,China•InstitutodeCienciaPolitica,Colombia•AsociacióndeConsumidoresLibres,CostaRica•IDEAS,CostaRica•CentredeAnalisisparaPolíticasPúblicas(CAPP),DominicanRepublic•InstitutoEcuatorianodeEconomíaPolitica,Ecuador•TheEgyptianCenterforPublicPolicyStudies,Egypt•InstituteforEconomicStudiesEurope(IES),France•NewEconomicSchool,Georgia•FriedrichNaumannFoundation,Germany•InstituteforFreeEnterprise,Germany•IMANICenterforPolicyandEducation,Ghana•GreekLibertiesMonitor(GLM),Greece•Thought4Action,Greece•KEFiMCenterforLiberalStudies"MarkosDragoumis•CIEN,Guatemala•FundaciónEléutera,Honduras•TheLionRockInstitute,HongKong•CentreforCivilSociety,India•CentreforPolicyResearch,India•LibertyInstitute,India•IndiaInstitute,India•IndiaPropertyRightsAlliance,India•CenterforIndonesianPolicyStudies,Indonesia•IraqInstituteforEconomicReform,Iraq•HiberniaForum,Ireland•JerusalemInstituteforMarketStudies,Israel•Competere,Italy•CampagneLiberali,Italy•Thinkin,Italy•IstitutoBrunoLeoni,Italy•PacificAllianceInstitute,JapanInstituteforDevelopmentandEconomicAffairs(IDEA),Kazakhstan•CenterforFreeEnterprise,Korea•BishkekBusinessClub,KyrgyzRepublic•CentralAsianFreeMarketInstitute,KyrgyzRepublic•LebaneseInstituteforMarketStudies,Lebanon•OHRIDInstituteforEconomicStrategiesandInternationalAffairs,Macedonia•InstituteforDemocracyandEconomicAffairs(IDEAS),Malaysia• SoutheastAsiaNetworkforDevelopment(SEANET),Malaysia/ASEAN•CaminosdelaLibertad,Mexico•CenterofResearchandDevelopment(CIDAC),Mexico • InstitutodePensamientoEstratégicoÁgoraA.C. (IPEA),Mexico • FundaciónIdea,Mexico • EBIThinkTankInstitute,Mongolia • Center forEntrepreneurshipandEconomicDevelopment(CEED),Montenegro • TheArabCenter forScientificResearchandHumaneStudies,Morocco •SamriddhiFoundation,Nepal • NewZealandTaxpayers’Union,NewZealand • InitiativeforPublicPolicyAnalysis,Nigeria • Civita,Norway • InternationalResearchFoundation (IRF),Oman • AlternateSolutions Institute,Pakistan • PolicyResearchInstituteofMarketEconomy(PRIME),Pakistan • PalThink forStrategicStudies,PalestinianTerritories•FundaciónLibertad,Panama•ContribuyentesporRespeto,Peru•InstituteforLibertyandDemocracy,Peru•InstitutodeLibreEmpresa,Peru•FoundationforEconomicFreedom,Philippines•MinimalGovernmentThinkers,Inc.,Philippines•ForumObywatelskiegoRozwoju,(FOR)Poland•WarsawEnterpriseInstitute,Poland•StowarzyszenieKoLiber,Poland•CenterforInstitutionalAnalysisandDevelopment(CADI),Romania•Libek,Serbia•F.A.HayekFoundation,Slovakia•TheFreeMarketFoundation,SouthAfrica•Civismo,Spain•ForoRegulaciónInteligente,Spain•AdvocataInstitute,SriLanka•Timbro,Sweden•WorldTaxpayersAssociations(WTA),Sweden•LiberalesInstitute,Switzerland•InstituteofFutureStudiesforDevelopment(IFD),Thailand•AssociationforLiberalThinking,Turkey•FreedomResearchAssociation,Turkey•CentrodeEstudiosparaelDesarrollo,Uruguay•BowGroup,UK•GenevaNetwork,UK•InstituteforEconomicAffairs,UK•UkrainianEconomicFreedomsFoundation,Ukraine•PropertyRightsAlliance,USA•ActonInstitute,USA•CenterfortheDisseminationofEconomicKnowledge(CEDICE),Venezuela•ZambiaInstituteforPublicPolicyAnalysis(ZIPPA),Zambia
FOR MORE INFORMATION, OR TO BECOME A PARTNER ORGANIZATION, PLEASE CONTACT LORENZO MONTANARI, EXECUTIVE DIRECTOR OF THE PROPERTY RIGHTS ALLIANCE AT
2017 IPRI – EXECUTIVE SUMMARY
anorganizationbasedinWashington,D.C.,dedicatedtothepromotionofpropertyrightsaroundtheworld.
In2007,PRAinstitutedtheHernandodeSotofellowshipforthepurposeofdevelopingtheIPRI.Sincethen,
the yearly IPRI has served as a barometer for the status of property rights, ranking the strength of both
physicalandintellectualpropertyrightsincountriesaroundtheworld.
During 2017, PRAworkedwith 111 think tanks andpolicy organizations in 72 countries to compile case
studies, conduct research, formulate public policy, and educate the public on the important role property
rightsplayintheircountries.
Property rights underline the values and principles related to individual liberty and economic freedom.
A strong property rights system, as shown by the correlations with the Index, is conducive to fostering
economic growth, human capabilities, research and innovation, environmental performance,
andthecreationofsocialcapital.Propertyrightsareakeyingredientfortheprosperityofsociety.Thisyear
theIndexhasaddedalibertydimensionofdevelopmenttoevaluateitscorrelationswiththeIPRI.
TheIPRIisbuiltupfrom10factors,gatheredunderthreecomponents:theLegalandPoliticalEnvironment
(LP), Physical Property Rights (PPR), and Intellectual Property Rights (IPR). The overall grading scale
oftheIPRIis[0–10],where10isthehighestvalueand0isthelowestvalueineachcategory.
The2017editioncovers98.44%ofworldGDPand93.43%oftheworld’spopulation.
I. RESULTS
The 2017 IPRI ranks a total of 127 countries (Figure 1). The selection of countrieswas determined only
bytheavailabilityofsufficientdata.
On average, the complete sample yielded an IPRI score of 5.6336. The Legal and Political Environment
istheweakestcomponent(5.1715)followedbyIntellectualPropertyRights(5.5027),whilePhysicalProperty
Rightsisthestrongestcomponent(6.2265).ThisyearwefoundanoverallimprovementoftheIPRI(+3.45%)
andofitscomponents(LP+0.81%,PPR+5.98%andIPR+3.18%).
New Zealand leads the 2017IPRI with an overall score of 8.6335, and has the highest ratings
in the LP (9.0311) and the PPR (8.8255) subindexes. Finland ranks second in the 2017IPRI (8.6257)
and has the secondhighest IPR component (8.6714). Rounding out the top five 2017 IPRI scores
are Sweden (8.6084), Switzerland (8.5614) and Norway (8.5326). The Scandinavian countries continue
toreporttopIPRIrankings(Finland#2,Sweden#3,Norway#5,andDenmark#12).Attheendofthetop15
listwefindAustria(8.0122),theUnitedStatesofAmerica(8.0741)andtheUnitedKingdom(8.1292).TheUSA
leads the IPR component (8.7155), followed by Finland (8.6714), and Japan (8.3267). The group of top
countriesremainsalmostthesameandtheirpositionsvarylittlefromthepreviousIPRIedition(Figure2).
Yemenranks127inthe2017IPRI(2.7281)followedbyVenezuela(3.0566),Bangladesh(3.1170),Moldova
(3.1781),Ukraine (3.4243), andBurundi (3.43). Considering the IPRI components the following countries
have the smallest scores: For LP: Venezuela (1.6795), Yemen (1.6929), theDem. Rep. of Congo (1.8236),
and Burundi (2.0979). For PPR: Brunei (3.2598), Ukraine (3.3779), Bangladesh (3.5024), and Moldova
(3.5102).ForIPR:Yemen(1.7075),Bangladesh(2.6225),Moldova(2.6622),andVenezuela(2.8012).Mostof
thelowestscoringcountriesperformworstontheLPcomponent.Thissituationistheoppositeforthetop
countriesandseemstohintattheabilityofLPtopulltherestofthecomponentsupward.
INTERNATIONAL PROPERTY RIGHTS INDEX | 2017 REPORT
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INTERNATIONAL PROPERTY RIGHTS INDEX | 2017 REPORT
FIGURE 1.
0 1 2 3 4 5 6 7 8 9
PERU 65
THAILAND 66
MEXICO 67
INDONESIA 68
UGANDA 69
TUNISIA 70
GUATEMALA 71
TANZANIA, UNITED REP. OF 72
ROMANIA 73
EL SALVADOR 74
SENEGAL 75
NEPAL 76
VIETNAM 77
TURKEY 78
ZAMBIA 79
HONDURAS 80
LIBERIA 81
KENYA 82
DOMINICAN REP. 83
MALI 84
BULGARIA 85
CROATIA 86
ETHIOPIA 87
GEORGIA 88
GABON 89
MALAWI 90
MACEDONIA, FYR 91
BRUNEI DARUSSALAM 92
ECUADOR 93
MOZAMBIQUE 94
C TE D’IVOIRE 95
BENIN 96
ARGENTINA 97
SIERRE LEONE 98
IRAN 99
PARAGUAY 100
EGYPT 101
KAZAKHSTAN 102
LEBANON 103
CAMEROON 104
MONTENEGRO 105
ALGERIA 106
ARMENIA 107
MAURITANIA 108
MADAGASCAR 109
SERBIA 110
RUSSIA 111
NICARAGUA 112
BOLIVIA 113
NIGERIA 114
115
BOSNIA&HERZEGOVINA 116
CHAD 117
ALBANIA 118
CONGO, DEM. REP. 119
ZIMBABWE 120
PAKISTAN 121
BURUNDI 122
UKRAINE 123
MOLDOVA 124
BANGLADESH 125
VENEZUELA, BOLIVARIAN REP. 126
YEMEN, REP. 127
NEW ZEALAND 1
FINLAND 2
SWEDEN 3
SWITZERLAND 4
NORWAY 5
LUXEMBURG 6
SINGAPORE 7
8
NETHERLANDS 9
AUSTRIA 10
CANADA 11
DENMARK 12
UNITED KINGDOM 13
UNITED STATES 14
AUSTRIA 15
GERMANY 16
IRELAND 17
BELGIUM 18
HONG KONG 19
ICELAND 20
UNITED ARAB EMIRATES 21
QATAR 22
FRANCE 23
TAIWAN (China) 24
ESTONIA 25
SOUTH AFRICA 26
ISRAEL 27
CHILE 28
MALTA 29
CHECH REP. 30
PORTUGAL 31
MALAYSIA 32
RWANDA 33
KOREA, REP 34
SPAIN 35
URUGUAY 36
SLOVAKIA 37
MAURITIUS 38
OMAN 39
40
POLAND 41
BAHREIN 42
SAUDI ARABIA 43
0 1 2 3 4 5 6 7 8 9
BOTSWANA 44
COSTA RICA 45
46
SLOVENIA 47
HUNGARY 48
ITALY 49
LITHUANIA 50
PANAMA 51
CHINA 52
GHANA 53
INDIA 54
TRINIDAD & TOBAGO 55
MOROCCO 56
CYPRUS 57
BRAZIL 58
SRI. LANKA 59
GREECE 60
KUWAIT 61
COLOMBIA 62
LATVIA 63
PHILIPPINES 64
II. IPRI GROUPS
Countries were grouped according to their relevant geographical regions, income levels, degree
of development, and participation in regional integration agreements. Averages were calculated for each
grouping.
North America (8.126) and Western Europe (7.664) earned the top positions, while Africa (4.810)
andCEECA(4.937)areatthebottom.AccordingtotheWorldBankgeographicalclassifications,Oceanialeads
thegroups(8.439),followedbytheEU(6.815),andNorthAmerica(7.149).AllregionsbuttheRestofEurope
(0.124) improved their scores. Central America and the Caribbean increased the most, with
an increase of 10.25% from 2016. According to the World Bank income classification the High Income
(+5.44%)andtheLowIncomecountries(+7.79%)improvedthemost.TheLowIncomeclassification(4.608)
receivedbetter scores than the LowerMiddleIncome group (4.487), so for the first year, the IPRI scores
donotdirectlyfollowincomeclassification(Figure3).
The Regional and Development classification of the IMF shows that the top IPRI2017 scores are held
bytheAdvancedEconomies(7.419), followedbyMENA&Pakistan(5.210),EmergingandDevelopingAsia
(5.146), and Latin American and Caribbean countries (5.117). Emerging and Developing Asia (+7.72%)
andLatinAmericanandCaribbean(+7.61%)improvedthemost.Allregionsimprovedtheirscorescompared
tothoseof2015.
FIGURE 2.
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INTERNATIONAL PROPERTY RIGHTS INDEX | 2017 REPORT
INTERNATIONAL PROPERTY RIGHTS INDEX | 2017 REPORT
TOP COUNTRIES | Ranking Change
FINLAND
NEW ZEALAND
LUXEMBURG
NORWAY
SWITZERLAND
SINGAPORE
SWEDEN
JAPAN
NETHERLANDS
CANADA
DENMARK
AUSTRALIA
HONG KONG (SAR of China)
UNITED KINGDOM (UK)
UNITED STATES (USA)
GERMANY
NEW ZEALAND
FINLAND
SWEDEN
SWITZERLAND
NORWAY
LUXEMBURG
SINGAPORE
JAPAN
NETHERLANDS
AUSTRALIA
CANADA
DENMARK
UNITED KINGDOM (UK)
UNITED STATES (USA)
AUSTRIA
GERMANY
2016 2017
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INTERNATIONAL PROPERTY RIGHTS INDEX | 2017 REPORT
FIGURE 3.
III. IPRI and POPULATION
Thisyear’ssampleof127countrieshasapopulationof6.87billionpeople,with68%ofthepopulationliving
in66countrieswithanIPRIscorebetween[4.5and6.4],while15.2%ofthepopulationenjoyshigherlevels
of property rights protection in 34 countries [6.59.4], % of the population live in 27 countries
with thelowestlevelsofpropertyrights[2.54.4](Figure4).
FIGURE 4.
2.5 a 3.4
3.5 a 4.4
4.5 a 5.4
5.5 a 6.4
6.5 a 7.4
7.5 a 8.4
8.5 a 9.4
6
21
44
22
13
15
6
127
279,008
873,551
1,693,397
2,978,506
285,176
723,165
33,888
6,866,690
4.06
12.72
24.66
43.38
4.15
10.53
0.49
100
2.646
11.846
30.365
18.510
12.615
16.830
7.187
100
2.307
9.062
22.571
44.605
5.215
15.472
0.768
100
IPRI 2017Countries(number)
P ation(thousand)
P ation(%)
e(%)
IPRI-P ation
IRPI
LP
PPR
IPR
Lower Middle
0
1
2
3
4
5
6
7
8
7
IV. IPRI and GENDER
GenderEquality(GE)isagoalinitself.Itsdevelopmentislinkedparticularlytohealth,education,agriculture
andunbiasedaccesstocreditforreducingpoverty.Inthisway,genderequalityplaysadecisiveroleforless
developedanddevelopingcountries.
tocredit,women’saccesstopropertyotherthanland,inheritancepractices,andwomen’ssocialrights.After
calculatinggenderequalityasanindependentmeasuretheresultswerethanaddedasan11thcomponent
totheexistingIPRI,tomaketheIPRIGEusingascale[012].
The2017IPRIGEshowsresultsfor123of the127countries included inthisyear’ssample.TheGEworld
avarageis7.118whichislowerthanthepriortwoyears(2016=7.466;2015=7.39),whiletheIPRIGEscore
is 7.438 showing a sustained improvement (2016=6.933; 2015= 6.76). This means that gender equality
is deteriorating as an average, while the property rights protection improves. Looking in detail at the GE
componentwefindthattheInheritancePracticesandWomenAccesstoLandOwnershiparethetwoitems
withthelowestscores.
New Zealand leads the IPRIGE (10.628), followed by Finland (10.62), Sweden (10.61), Norway (10.53),
Luxembourg (10.46), Switzerland (10.45), Japan (10.31), Netherlands (10.29), Australia (10.24), Canada
(10.17),Denmark(10.16),USA(10.07),andAustria(10.01).OntheotherextremeoftheIPRIGE,withscores
below 5, we find Yemen Rep. (3.45), Bangladesh (3.91), Congo Dem. Rep. (4.35), Pakistan (4.47), Nigeria
(4.57), Burundi (4.63), Chad (4.63), Moldova (4.76), Mauritania (4.86), and Algeria (4.998)
(Figure5).
The top geographical regions are North America (10.121) and Western Europe (9.655), while
at the bottom we find Africa (5.887) and MENA countries (6.463). Advanced Economies (9.367) lead
the Regional and Development groups, followed by Latin America and the Caribbean (6.785)
and Emerging and Developing Europe (6.630). At the bottom we find CIS (5.664) and SubSaharan Africa
(5.926). CIS countries show a high GE score (8.422) but the IPRI score (3.980) pulls down the IPRIGE.
INTERNATIONAL PROPERTY RIGHTS INDEX | 2017 REPORT
FIGURE 5.
Lower Middle
10
8
6
4
2
0
GE
IPRI-GE
AsimilarsituationhappenswithLatinAmericaandtheCaribbean(GE=8.336;IPRI=5.117;IPRIGE=6.785),
while the opposite happens with MENA & Pakistan (GE= 4.377) and Emerging and Developing Asia
(GE=5.952),wheretheGEscoreislow(Figure6).
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INTERNATIONAL PROPERTY RIGHTS INDEX | 2017 REPORT
FIGURE 6.
V. IPRI and DEVELOPMENT
Given the extensive literature that reports the important interactions between property rights
anddevelopment,weanalyzeddifferentdimensionsofdevelopment:EconomicOutcomes;Liberties;Social
Capital; Human Capabilities; Research and Innovation; and Ecological Performance with the IPRI
For the Economic Dimension, the ntrepreneurial nvironment (GEI) presented the strongest correlation
with
thebuildingblockofinnovation,investment,production,andeconomicgrowth.Itisalso
important tohighlightthattheGDPpercapitacorrelationsincreasedwhenadjustedbytheGINICoefficient,
which is ameasureofdispersion(orinequality).
ThepropensityofcountriestoexploitopportunitiesofferedbyInformationCommunicationTechnology(ICT)
asrecordedintheNRI,ameasureincludedinthenewLibertiesdimension,showedacorrelationof0.8570.
The strongest correlation is in the IPRILP category (0.881).Allmeasures in theLibertiesDimensionwere
stronger with the LP component. From the Social Capital Dimension, ivic ctivism (0.8013) showed
the strongest correlation, and from Research and Innovation Dimension, uman esources (0.7607)
showedthegreatestfit.
Figure 8 shows that, on average, countries in the top quintile of IPRI scores (i.e. top 20%) have
apercapitaincomealmost13timesthatofcountriesinthebottomquintile.Thisdisparityhasreducedover
time,in2016itwasalmost21timesandin2015almost24timesgreater.
LACAsia
MENA & Sub-Saharan CIS
10
8
6
4
2
0
GE
IPRI-GE
FIGURE 7.
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INTERNATIONAL PROPERTY RIGHTS INDEX | 2017 REPORT
0.814
0.839
0.764
0.720
0.878
0.768
0.675
0.732
0.857
0.747
0.801
0.565
0.656
0.635
0.679
0.605
0.761
0.685
0.594
0.821
0.826
0.767
0.721
0.886
0.812
0.722
0.792
0.881
0.711
0.800
0.631
0.712
0.674
0.738
0.590
0.752
0.635
0.648
0.630
0.659
0.635
0.514
0.690
0.633
0.576
0.499
0.678
0.694
0.605
0.394
0.498
0.445
0.477
0.477
0.553
0.495
0.395
0.788
0.834
0.707
0.744
0.840
0.669
0.565
0.708
0.812
0.685
0.810
0.523
0.595
0.618
0.638
0.610
0.796
0.758
0.574
Production
Investment
Complexity ofProduction
Enterpreneurship
GDP per capita
GDP per capita *GINI
Gross Capital Formationper capita
Economic Complexity
Economic
Absence ofCoercion
Connectivity
Index of EconomicFreedom, IEF
Economic Freedomof the World, EFW
Human Freedom Index, HFI
Networked ReadinessIndex, NRI
Global Enterpreneurship(GEI)
Social Capital Social Capital comp.(Prosperity Index)
Activism Civic Activism
Cohesion Intergroup Cohesion
Trust Interpersonal Safety & Trust
Inclusion Inclusion of Minorities
Current Situation Human Development Index,HDI
Future Condition Global Index on Freedomof Education, GIFE
EcologicalPerformance
EPI-Yale
Human Resource Researchers in R&D
Research & Developmentexpenditure
PPR IPRIPRI LP
Human
R&I
EP
Liberties
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INTERNATIONAL PROPERTY RIGHTS INDEX | 2017 REPORT
FIGURE 8.
FIGURE 9. Cluster’s Members & Centroids
2ndQuintile
$60,000
$50,000
$40,000
$30,000
$20,000
$10,000
$0
3rdQuintile
4thQuintile
Bottom20%
$57,230.30
$27,497.63
$13,821.69
$4,627.06 $4,533.16
IPRI Quintile
VI. IPRI CLUSTERS
Aclusteranalysiswasperformedforall127countriesaccordingtotheirvaluesinLP,PPRandIPRaiming
to group similar countries. The analysis showed that three clusters were sufficient to explain country
groupings.Eachclusterrepresentsmorethanagroupingbyvariablesdirectlyassociatedwithpropertyrights;
theyaregroupswithcommoncharacteristicswithinthemandwithdifferentfeaturesbetweenclusters,which
Itisimportanttonoticethatthisyearwefoundasignificantmovementofmostofthecountriestoanimproved
position(Figure9).
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INTERNATIONAL PROPERTY RIGHTS INDEX | 2017 REPORT
In2015Italyimplementedthe“PatentBox”,anoptionaltaxsystemforincomearisingfromtheuseofIPrights.Thefirst
Europeancountry to introducesuchan incentivewas Ireland in2000.ThenFrance,Belgium,Hungary,Luxembourg,
theNetherlands,SpainandtheUnitedKingdomfollowed.AspartofitsBaseErosionandProfitShiftingproject,theOECD
hasrecommendedtheimplementationofacommonapproachaimedatensuringthatonlytheincomecreatedinone
countrycanbenefitfromthatcountry'scorrespondingtaxrelief,proportionatetotheinvestmentmadethere.Despite
its name, however, the Italian patent box appliednot only topatents andknowhow,but also to copyright (at least
partially), designs and trademarks (the latter, however, were excluded in 2017). Furthermore, the Italian Ministry
ofEconomicDevelopmentissuedimplementationrulesaimedatfacilitatinguseofthissystembySMEs.However,the
Ministry of Economy and Finance took an inconsistent approach, whichmultiplied the burdens of thosewhowant
to benefit from the system, by requiring analytical documentation of costs incurred for the creation of every single
intellectualpropertyproduct–oftenanimpossibletask.IthasthuslosttheopportunitytoencourageItaliancompanies
toreshoretheirIPrightsandmanufacturingactivity.Instead,sinceIPrevenueandproductionofmanyimportantItalian
companiesremainparkedinforeignsubsidiariestheItalianPatentBoxledtoareductionintheamountoftaxrevenue,
ratherthanincreasingthetaxableincomeinItaly.ThishascreateddisappointmentandgarnereddistrustfromItaliantax
authorities.
Patent Box in Italy: Light and Shadow of a Special Tax Regime
By Prof. Cesare Galli, Istituto Bruno Leoni
Thiscasestudyisaboutinstitutionalrulesofthepoliticalgame:collectivedecisionmaking,legislation,governmentin
general,andtheirroleinprotectingindividualrights.Itfocusesonathin,butsubstantial,conceptionoftheruleoflaw
torestatethenormativeargumentforconstitutionaljusticemechanismsaspartofthebasicinstitutionsofafreesociety.
Then, through an analysis of the Mexican juicio de amparo judicial review mechanism, this study argues that
constitutional justice and the protection of human rights require judicial review to have general effects over
unconstitutionalfiscallaws.Thefactthatfiscalamparoprotectsonlytherightsofthosewhogotocourtdamagesjudicial
rationalityandinstitutionallegitimacy.Independenceishurtasthecourtsareusedbyinterestgroupstoadvancetheir
economic interestsoverotherswithout the resources todefendtheirrights.Thisgenerates incentives forpoliticians
totakeintoaccount judicialreview,butnonethelessenactunconstitutional lawseveryyearasonlya fewindividuals
will be protected against them, and incentivizes firms to engage in rentseeking behavior. In the end, I draw some
reflectionsuponmethodologicalconcernsfortheruleoflawmeasurementandconsolidation.
A Century of Injustice: Rule of Law, Constitutions and Property Rights in Mexico
By Esteban Gonzalez Herrejón, Caminos de la Libertad
TheWestern Balkan countries of Serbia, Montenegro, Macedonia, Bosnia and Herzegovina, Albania and Kosovo lag
behindotherEuropeantransitioncountriesintermsofeconomicdevelopmentandEuropeanUnionaccession.Although
thesecountrieshaveintroduceddeepreformsinmanyareas,especiallyduringthetransitionprocessofprivatizationand
democratization,propertyrightsinthesecountriesarenotwellprotectedwhichhindersfurthereconomicdevelopment
and social change. Instead of protecting property rights, state governments in these countries choose to infringe
theserightstopursuepoliticalgoals.Insteadofprotectingpropertyrights,stategovernmentsinthesecountrieschoose
Weak Governments and Partial Protection: Property Rights
in the Western Balkans
INTERNATIONAL PROPERTY RIGHTS INDEX | 2017 REPORT
ThereisadebateinVenezuelaoverwhoownsnaturalenergyresourcesandwhoshouldreceiverevenuederivedfrom
their sale. Currently, the resources are said to be owned by the nation, yet revenue from these resources
do not go to the public but to the Executive Branch, which is under the control of the dominant political party.
This has created a power imbalance and caused a great deal of political instability as the incumbent party is able
totakeadvantageofthenationalresourcesforpartisanpurposes.ThispapersuggeststhecreationofanEnergyCouncil
tooversee revenuedistribution fromresourceextraction industries.This is a starkcontrast from thecurrentpolicy,
whichisaproductof“socialisminthetwentyfirstcentury”ideas.WithanEnergyCouncil,managementdecisionstouse
revenuesderivedfromresourceextractionindustrieswouldbetiedtogetherandallocatedmoreefficiently,sterilized
frompoliticalmanipulation.Theexistingsocialistpolicy,implementedbythepastandcurrentBolivariangovernments
hasnationalizedelectricity,oil,gas,andminingindustries.Theresultshavebeennothingshortofdisastrous:shortages
ofessentialgoodsanddecliningrevenue.Itistimeforchangeandnewideas.TheEnergyCouncilwillplayastabilizing
role by separating the oil, gas, coal, and gold industries from partisan politics. The paper contains details on how
thecurrentsystemoperatesandhowanindependentenergycouncilcanbeformedtoplayaconstructiveroleinsolving
theVenezuelancrisis.
Jewish economics is derived from its theology and its legal system – the Halakha. According to its theology,
manwascreated“inGod’simage”withaGodlyportionwithinhim.Jewishtraditioninsiststhatmancan,andshould,have
apowerfulimpactuponthematerialworld,tohavedominionandtoaccumulatewealth.Thisinsistenceplaysitselfout
inavastlydifferentviewofpropertyrights.Ownershipdoesnotgenerateonlypleasure,butalsoresponsibilitytowards
theneedy, and throughthis responsibility it expresses theGodlyportionwithinman.Ownership,orpropertyrights,
in Judaism, are not given to the individual from the state and they are not respected because of their contribution
tosociety.AccordingtotheJewishlegalsystem,theHalakha,propertyrightsareperceivedasajustright,andtheyare
generated from the divine law, as prohibitions and obligations of every person towards his fellow's dominion over
hisproperty.
A Special Case Study on Religion & Property Rights: Property Rights from a
Judaism Perspective. Dominion and Property Rights in Judaism
toinfringetheserightstopursuepoliticalgoals.TheaimofthispaperistopointoutdifferencesbetweenWesternBalkan
countriesintheirtransitionpathfromothertransitioncountriesintheregion.Thepaperillustratestheimpactofthese
differencesonpropertyrightprotectionswithcasestudiesfromSerbia,andBosniaandHerzegovina.Thepaperdescribes
thepresentandpaststateofprivatepropertyrightsinWesternBalkancountrieswithafocusonthetransitionperiod
from communism to democracy. In conclusion, based on the comparative analysis, this paper offers a set
ofrecommendationsforimprovingprivatepropertyrightsintheWesternBalkans.
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