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Many economists have argued that property-rights institutions are fundamental causes of long-run economic growth. However, empirical studies are often plagued by issues of endogeneity and omitted variables bias. In this paper, we focus on the effect of a particular property rights institution – patent laws, on economic growth. The debate over the effect of patent laws on economic growth is old. This controversy reached such a height during 1850-1875 that the Netherlands repealed its patent law in 1869, which was not reinstated until 1912. Recently Boldrin and Levine advocates abolishing patent laws.
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