Archive for the ‘Property Rights’ Category

Property Rights, Government, and Development

August 1, 2007

Prior to my decision to focus on corruption for my honor’s thesis, I was focusing on property rights (the topic of this post, previously left incomplete).  I leave it as is without further development, but I think the questions at the end merit attention. 

My readings of late have focused on the nature of property rights and the importance of their role in indigenous societies.  Some focus on the mythology that has sprouted up about the harmonious relationship that societies have with nature and their neighbours.  Others have focused on how indigenous groups located within developed societies, and which have experienced a long history of oppression, are now adopting certain rules of private property in order to “opt-in” to the national or global economy.  Most recently, I read a paper whose author argues that a system of formalized property rights enforced by the state – a proposed solution about which most mainstream economists find themselves quite enamored – is neither a necessary nor sufficient condition for the rise of efficient markets for land. He suggests instead that the government work only to broker intercommunity agreements to ensure that no conflicts arise from alloting land rights to strangers (either by rental or sale or other measures).

It is this last point that I would like to take up.  Such a proposition does not, in my humble opinion, sync up with the Hobbesian view of government that most economists are so prone to accept as given.   If we assume that theory, then it is impossible to expect a government to fairly broker such deals.  Indeed, the differential power of the parties to any sort of deal-brokering will inevitably play an important role in how the government moderates any such proceedings. 

Two questions, then, are important to answer:  1) Is the Hobbesian and/or Machiavellian theory of government adequate?  2) If so, can we honestly expect a government to fairly broker intercommunity agreements on property rights?