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Evaluating Conditions for Capitalist Growth
An economist observes a country that has recently legalized private ownership of businesses and established markets for goods and services. However, after several years, the country has not experienced the significant, sustained economic growth often associated with such changes. Based on the core institutional requirements of a dynamic economic system, critically evaluate potential reasons why this country's transition might be failing to generate substantial growth. In your answer, identify at least two key institutional features that might be weak or missing and explain how their absence would hinder the mechanisms that drive innovation and productivity improvements.
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