WHY "PROPERTY" ?

Labor

Locke explains property as flowing from an intrinsic right to the fruits of one’s labor. Just as there is a right to exclude unwanted interference from one’s body, there is a right to exclude unwanted interference from the things with which one’s body has mixed itself. Labor, Locke says, is a mixing of the body or mind with the object of labor.

While there is an element of truth here, there is but an element. First, mixing labor with a library book creates no right in it. The same goes for a public sidewalk. Second, an individual’s ability to engage in labor is self-generated. Talent and hard work help, but education and the investment of others, along with access to material ingredients needed to make something real, must all exist outside the self. These things come from others, and from nature. Labor cannot be the sole origin of property.

Efficiency

All of us have read Demsetz in property class. You know the article. Exclusive ownership by an individual can avert the tragedy of the commons. In communal ownership, people selfishly take more than their optimal share. If overhunting will deplete everyone’s stock of fur-bearing animals in the long run, the only way to reign in harmful individual behavior in the short run is to assign each person a small tract of hunting land, bringing the results of bad behavior home to roost.

This does make sense, I admit. Given a scenario in which overconsumption will deplete future supplies, present needs should not trump future needs, and private ownership makes this somewhat more apparent. But what if use now will not deplete future supply? Ideas, knowledge, and technology are not depleted when used. Other resources are so plentiful that all people alive could not exhaust them. Examples include corn and wheat, or toothbrushes. These are all cheap, and plentiful.

Also, Demsetz’s theory does not explain the allocation of resources among groups of owners. His article does not explain how a system of private ownership can balance the needs of one person against those of another. The fur-hunting example has two flawed premises. First, property borders can move. Working from his assumption that there are advantages to disadvantaging others, the natural results of physical delineation would be warfare for territorial expansion. Although the long-term supply problem may be solved, this occurs at the expense of actors in the present. Second, hunting quotas imposed by the tribal government could also be used to limit overconsumption, without necessitating land ownership or geographic conflicts.

Competition

Many businesspeople, if not our law textbooks, would say that property serves an allocative function, allowing markets to maximize net utility. Property assigns ownership to whoever does what it takes to gain control over a thing. Sometimes this is trickery, but usually it is socially beneficial labor. Wealth, as a reward for good deeds and hard work, provides a framework for competition between individuals, making manifest a scale. This increases net wealth, by placing value on it.

This explanation meshes nicely with an evolutionary theory of sexual selection, in which mate choice depends on displays of flashy material goods. Whether this justifies property depends on whether or not you think differential discrimination among mates is better for humankind than the material waste is bad. Assuming that human beings are more valuable than apes, and that sexual selection facilitated that marked improvement, sexual selection has been a good thing. However, like most beneficial processes, selection can spin out of control and harm the very organisms that it helped create. A large, colorful tail can make a bird vulnerable to hawks. A contest to win a desirable mate can destroy the happiness or boon that was sought as the reward for victory. Similar things happen in human society.

Aside from our gradual destruction of the earth and its ecosystems, this can be seen in the unhelpful distribution of new wealth created by society. For maximizing well being, how much wealth is owned matters less than how much wealth is owned by the poorest segment. For young, healthy members of society, almost no correlation exists between wealth and happiness. For the old, the infirm, and the impecunious, additional wealth improves life in tangible, significant ways. In the system as it stands, new wealth goes not to those who would benefit from it, but to those who already have the capital needed to gather more resources. This failure of the competitive system is built into the system via the incentive structure that made it exist in the first place.

I don’t think that any of the frameworks outlined above really explain why property must exist the way it does. Labor, efficiency, and competition do not give to “property” that sense of reality that one would hope for in a basic “right.” Perhaps property does not exist at all, in and of itself, but is an illusion.

If property rights are illusory, they may still be useful. They have power. If this is true, perhaps a better starting point would be in actual human need. Lack of shelter, food, and context in which to exercise creativity could provide an alternative basis for the assignment of new property rights. Our focus then would shift from the advantages of keeping people from having what might be ours to the universally beneficial results of an expansion of the productive community. Deprivation might be turned into fresh opportunity, with benefits that accrue to everyone. If need bears no relation to ownership, I think our system must produce results contrary to its ultimate purpose.

OLD VERSION, WITH MOGLEN'S COMMENTS:

WHY IS EXCLUSIONARY OWNERSHIP THE RULE?

By SamWells - 21 Feb 2010