"Intensive research in recent years into the sources of economic growth among both developing and developed nations generally point to a number of important factors: the state of knowledge and skill of a population; the degree of control over indigenous natural resources; the quality of a country's legal system, particularly a strong commitment to a rule of law and protection of property rights; and yes, the extent of a country's openness to trade with the rest of the world. For the United States, arguably the most important factor is the type of rule of law under which economic activity takes place. When asked abroad why the United States has become the most prosperous large economy in the world, I respond, with only mild exaggeration, that our forefathers wrote a constitution and set in motion a system of laws that protects individual rights, especially the right to own property. Nonetheless, the degree of state protection is sometimes in dispute. But by and large, secure property rights are almost universally accepted by Americans as a critical pillar of our economy. While the right of property in the abstract is generally uncontested in all societies embracing democratic market capitalism, different degrees of property protection do apparently foster different economic incentives and outcomes."

Alan Greenspan Economics See all quotes by Alan Greenspan →

React to this quote

More by Alan Greenspan

“Of course, shedding the debt burden would be a happy development for our country, but it would nevertheless pose a big dilemma for the Fed. Our primary lever of monetary policy was buying and selling treasury securities-Uncle Sam's IOU's. But as the debt was paid down, those securities would grow scarce, leaving the Fed in need of a new set of assets to effect monetary policy.”

“Yes, I’ve found a flaw. I don’t know how significant or permanent it is. But I’ve been very distressed by that fact.”

“Once stock prices reach the point at which it is hard to value them by logical methodology, stocks will be bought as they were in the late 1920s not for investment but to be unloaded at a still higher price. The ensuing break could be disastrous because panic psychology cannot be summarily altered or reversed by easing money policies.”

“We had a bubble in housing.”

“Without calling the overall national issue a bubble, it's pretty clear that it's an unsustainable underlying pattern.”

“We generally did not talk about the stock market very much at the Fed.”

Resonant Thoughts

"We all know the extent of the hypocrisy which surrounds the War on Drugs; that it is, at essence, a Class War, or, if you will, a Race War, which criminalizes the undesirable elements of society – pre…"

— Mark Pesce

Education1962

#knowledge

"In order to complete the history of the human mind, and attain to a perfect knowledge of its nature and operations, we must contemplate man in all those various situations wherein he has been placed. …"

— William Robertson (historian)

Military1721–1686

#knowledge

"I myself am part of the youth movement. However, after a long discussion, it appears that many of the youth demands and needs, like access to education, jobs, and equitable growth, have been addressed…"

— Tawakkol Karman

Politics1979

#knowledge

"Science is not a special sense. It is as wide as the literal meaning of its name: knowledge. The notion of the specialized mind is... as modern as the specialized man, 'the scientist', a word which is…"

— Jacob Bronowski

Literature1908–1974

#knowledge