Property isn’t a vertical relationship between a person and an object, but instead is a horizontal, reciprocal relationship of exclusions between people. Since the benefit of one person in regard to property comes at the expense of someone else, there’s no logical or coherent way to invoke liberty or classical liberal principles of “do no harm” when it comes to how the law determines the shape of property. All we can do is pick among competing systems that try to achieve shared social goals.
That’s not an idea normally associated with the economist Ronald Coase, who died yesterday at 102. But it’s a very important part of his landmark paper, ”The Problem of Social Cost” (1960), that goes missing when the right-wing celebrates his legacy. Let’s unpack it.Next New Deal | Rortybomb
How Ronald Coase Demolished Current Libertarian Ideas About Property
Mike Konczal
Konczal bases much of his post on the Coase Theorem, which was a product of George Stigler, based on the work of Coase. Coase, however, rejected it as his. "Coase himself has stated that the theorem was based on perhaps four pages of his 1960 paper The Problem of Social Cost and that the "Coase theorem" is not about his work at all." (source)
I have always wondered how Libertarian Austrian economics could think that the system of enforceable property rights that Rothbard proposes could possibly work given transaction costs involved in litigating disputes over externalities. It would be litigation nation, and a lot of the judicial decisions would be based on the way judges approached issues. How lawmakers and judges would be selected would be extremely important since where there is power there is politics and class structure.
