29th August 2012
Reading list on property rights
Property rights are the key driver of prosperity. If you can't clearly own the fruits of your labour (and/or your inheritance) and exchange it with others, you won't create value.
In DOF I've got an extensive discussion on property rights as a key institution of the free society.
This reading list is intended to support/ supplement my personal readings on property rights.
When we think of property rights, we necessarily start with John Locke. Later thinkers who have contributed significantly to such analysis include Ronald Coase, Armen Alchian, Harold Demsetz, Douglass North, Richard Posner and Oliver Williamson.
I have one issue with (most of) this literature, in relation to property rights in land. Most economic literature on property largely assumes the existence of the state and there is insufficient recognition of the fact that territory must exist and be well protected (and well-documented) before individual property rights in land can be properly protected. The issue of eminent domain is linked with this. No property rights theory can be complete without a theory of eminent domain and analysis of the powers of the state to acquire land.
In DOF I've separated the social contract into two key parts: one re: the fortress (defence of territory) and the other (conditional on the fortress), for other public goods (security, justice). Defence of territory is the SUPREME public good. On its existence depend all other possible rights. However, does defence of territory give the state unlimited rights? I don't think so.
A gem from Alchian and Desmsetz (1973):
private rights can be socially useful precisely because they encourage persons to take account of social costs. The identification of private rights with anti-social behavior is a doctrine as mischievous as it is popular.
America started with the world's first communist experiment: MUST VIEW!
(I think Obama should see this)
PRELIMINARY READING LIST – IN NO ORDER – WORK IN PROGRESS
(There are many! more key articles/books that I need to include here. I'm publishing this nevertheless, as a starter, and will keep adding as time permits.)
H. Demsetz, "Toward a Theory of Property Rights," AEA Papers and Proceed¬ings, May 1967, pp. 253-257.
Barzel, Yoram, The Economic Analysis of Property Rights