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Why is private property and the protection of property rights so crucial to the success of the market economy?

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Market economies are most often associated with capitalism. Capitalism is defined by the privatization of forces of supply and demand. The effects of supply and demand transfer capital from less desirable investments to investments that offer a more substantial return on the investment. Private property is a form of capital investment in one sense. A capitalist economic system differs from a Marxist or socialist economy on how capital is distributed and on private ownership of property. In a Marxist or socialist economy, in theory, there is no private ownership of property. Property is for the public good, and the use of the property or the distribution of property is government-controlled.

In a capitalist economic system, private property is considered an investment, and its use with some restrictions is controlled by individuals. Protecting property rights is one way of managing wealth. In countries where there is little or no protection for property rights, capital does not easily...

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