Seven major sources of economic progress-
Efficient Legal system-
As explained above, it is an established fact that a country can only flourish with free trade, enhancement of industries and the existence of private property. Only an effective legal system can guarantee optimum utilization of these factors. Legal system helps in avoiding uncertainties and arbitration on the part of the players in the market. Property includes ownership of labor services and ideas as well as physical assets such as buildings and land. Private ownership not only helps in prosperity but also makes individuals responsible for their own action. Private ownership encourages wise stewardship, as one feels responsible towards one’s own property. As ‘self-interest’ is at stake, the owner tends to use his/her property for productive endeavors. Private ownership encourages usage of their property in a way that automatically benefits others. Usually private owners focus on conserving their resources for the long term, this leads to planning and consequently systematic growth. It is necessary to understand the incentives that private ownership operates with. When there is a scarcity of these resources, the prices usually soar up which leads to automatic conservation of these resources and also people are encouraged to find better alternatives then.
A legal system that protects private property provides foundation for capital formation and gains from trade which is the mainsprings of economic growth.
Competition- A driving force for pushing innovation and efficient use of resources-
In a free market, consumers tend to play an important role of choosing from the best available alternative. This creates competition for the producers who are compelled to make the best of what resources they have. Competition eradicates inefficient producers. It creates incentives for producers to develop better products, and that also in a lower cost. Complacency in the part of the producer is...