Property Rights

Loading the player...

What are 'Property Rights'

Laws created by governments in regards to how individuals can control, benefit from and transfer property. Economic theory contends that government enforcement of strong property rights is a determinant regarding the level of economic success seen in the area. Individuals will create new forms of property to generate wealth, only when they are assured that their rights to their property will protect them against unjust and/or unlawful actions by other parties.

BREAKING DOWN 'Property Rights'

For example, if property rights were not established to prevent a government from freely expropriating foreign created business ventures without proper compensation, then it is unlikely that any foreign company would risk going into that country for risk of losing their entire operation.

While property rights regarding physical property has been well established. Many justice systems must now contend with property that solely exists in a digital or virtual setting. For example, who ultimately owns a house built in a game on the Internet, the user that created the house with his character? Or the game development company that created the game who also owns the server in which the house resides in?

RELATED TERMS
  1. Property Management

    The administration of residential, commercial and/or industrial ...
  2. Property Tax

    A tax assessed on real estate by the local government. The tax ...
  3. Form 4797

    A tax form distributed by the Internal Revenue Service (IRS) ...
  4. Investment Property

    A real estate property that has been purchased with the intention ...
  5. Personal Property

    A type of property which, in its most general definition, can ...
  6. Property Manager

    An individual or company responsible for the day-to-day functioning ...
Related Articles
  1. Economics

    How Property Rights Affect Economies

    Property rights are laws governments create that enable investors to control, benefit from, and transfer property.
  2. Home & Auto

    The Complete Guide To Becoming A Landlord: Hiring A Property Manager

    A property manager can perform such duties as marketing your rental property, selecting tenants, maintaining the property, creating budgets and collecting rent. You may consider hiring a property ...
  3. Professionals

    Community Property Vs. Non-Community Property

    Community Property Vs. Non-Community Property
  4. Home & Auto

    Investing In Property Out Of State

    If you can't afford property close to home, consider taking the real estate plunge elsewhere in the country.
  5. Home & Auto

    What You Should Know About Real Estate Valuation

    Anyone involved in a real transaction can benefit from gaining a basic understanding of the different methods of real estate valuation.
  6. Taxes

    Getting U.S. Tax Deductions On Foreign Real Estate

    If your home or second home is not in the United States, you can still get U.S. tax deductions. How many and what kind depends on whether you also rent it.
  7. Home & Auto

    Investing In Foreclosures Not A Get-Rich-Quick Venture

    Investing in this kind of real estate takes capital, time and careful planning.
  8. Taxes

    Sell Your Rental Property For A Profit

    Being a landlord can be taxing, especially when you want to sell. Find out how to reduce your burden.
  9. Investing

    How Does a Tax-Free Exchange Work?

    In regards to the sale of property, particularly in real estate, a 1031 exchange is increasingly being recognized for its tax benefits to investors of all levels.
  10. Investing

    The Guide to Investing in REO Properties

    Real estate owned properties present a unique investment opportunity but there are some specific challenges to be aware of before diving in.
RELATED FAQS
  1. What is the difference between real estate and real property?

    Understand how real estate is legally different from real property and the implications of that difference for each property ... Read Answer >>
  2. What criteria does a property need to meet to be considered an 'investment grade' ...

    Learn what it takes for institutional investors to consider a property "investment grade," such as real estate investment ... Read Answer >>
  3. How are capitalism and private property related?

    Read about the relationship between capitalism and private property rights, and learn why voluntary trade would collapse ... Read Answer >>
  4. What do states do with unclaimed property?

    Understand what unclaimed property is and what types of property can be considered abandoned or unclaimed. Learn what states ... Read Answer >>
  5. How is Net Operating Income (NOI) used in real estate?

    Find out more about net operating income, what it measures and how it is used to analyze a real estate property's return. Read Answer >>
  6. What are the main differences between a mixed economic system and pure capitalism?

    Read about the primary differences between a mixed economic system and a laissez-faire, free market economic system with ... Read Answer >>
Hot Definitions
  1. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  2. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  3. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  4. Keynesian Economics

    An economic theory of total spending in the economy and its effects on output and inflation. Keynesian economics was developed ...
  5. Society for Worldwide Interbank Financial Telecommunications ...

    A member-owned cooperative that provides safe and secure financial transactions for its members. Established in 1973, the ...
  6. Generally Accepted Accounting Principles - GAAP

    The common set of accounting principles, standards and procedures that companies use to compile their financial statements. ...
Trading Center