Mindful property rights

We all know that uncertainty is the great enemy of prosperity, but people often forget why that’s true. Uncertainty’s great cost is that most forms of investment require years to earn a return, and investors won’t invest where the risks of not earning that return are too great or the future is too hard to read. Thus it is that societies that find ways to reduce uncertainty to the greatest extent possible will enjoy a real advantage compared to others. One of the greatest institutions for the reduction of uncertainty is robust and enforceable property rights. If I know what is mine, and I know I can protect it from being stolen or expropriated, I am safer investing in improving that property’s productive potential.  All of this is true for property in ideas or concepts as much as it is in car plants and farms. Yet Canada performs poorly in the international intellectual property rankings, which means we are missing an opportunity to unlock investment in technology, biotech, entertainment, design, R&D, nanotechnology, telecoms and a host of other areas where intellectual property is the sine qua non of investment. Read all about it in my latest column for the Economy Lab feature in the Globe’s Report on Business.