1) Define property rights, the ways governments can infringe on them and then assign values to those infractions.<p>2) In part, you can measure the amount of paperwork and time delay in achieving common tasks, like buying land, building a warehouse and incorporating. The sheer number of regulations may also be an indicator for the amount of friction the government is introducing. Defining "level of regulations and rules" is also important in order to come up with a good quantification scheme.