Private Law Theory

ABSTRACT
A basic tenet of property theory is the superior efficiency of private property over forms of common ownership. The commons are, as Garrett Hardin famously said, subject to a tragedy of overuse and waste by co-users precisely because no one can stop the use and overuse by others. Private property triggers a right to exclude that ensures the fruits of the owner’s labor will be captured by the owner and not someone else. But what happens to all those co-owners now excluded?

In a hypothetical world, they either disappear from the equation or assumedly all retreat each to their own private fee estates where they too comport with the private property incentive to efficiently work their land. In the real world, the excluded have to get a job – and the excluders, the property owners of fields, factories and other places of business, need them to do just that. In short, private property entails a right to exclude as well as the necessity that the excluded return, now as employees. In that sense, the problems of shirking and grabbing, bad incentives that are attributed to forms of common ownership, resurface in the employer-employee relationship and are, in fact, as integral to private property as they are to a commons. That is the simple point this essay makes.

The excluded must return. Fields won’t sow and reap themselves. An incentive is needed to motivate a person to work your field rather than their own – and that incentive is precarity. Some people must lack their own fields but, still needing food, shelter and other basic necessities, be motivated to hire themselves out. Obvious perhaps, but typically unstated as a necessary social condition integral to the efficiency of private property.

Finally, this essay notes there is an ongoing tragedy of the commons under our private property system. The commons here is us – the human labor pool. From the property owner’s perspective, the incentive is to exploit this resource regardless of the impacts on the resource itself. For Hardin, this meant exploiting the pasture past the point of its ability to sustain forage. In reality, this means workers are to be monitored and disciplined, not just to curb the inherent incentives to shirk and grab what cannot belong to them, but moreover to extract the maximal amount of work out of the laborer, regardless of the cost to the laborer herself. She is, after all, a typically fungible commodity. And that impulse to waste the human resource while extracting their labor is a facet that is integral to private property with all the other incentives and disincentives that the property system motivates.

All this essay does is take some classic essays of property theory and carry their logic the next step to foreground the points related above – points the classics of property theory either only touch on indirectly or ignore completely.

Miskinis, Steven, The Return of the Excluded (January 15, 2024).