Exchange, Theft, and the Social Formation of Property
Document Type
Article
Publication Date
6-2010
Abstract
We design a laboratory experiment to explore whether and how property endogenously arises in a specialization and exchange environment where “theft” is costless. Additional treatments make available optional private protection mechanisms. We find that although an absence of exogenous enforcement does not hamper property's emergence in all cases, the private options tend to worsen outcomes on average. Property emerges when subjects self-organize groups, understand potential gains from trade, convince group members that all benefit by avoiding theft, and display credible commitment to cooperation in their actions. In other words, as Hume argued in 1740, property is a convention.
Recommended Citation
Kimbrough, E., Smith, V. and Wilson, B. "Exchange, Theft, and the Social Formation of Property." Journal of Economic Behavior & Organization, 74(3), p. 206-229, June, 2010.
DOI:10.1016/j.jebo.2010.03.017
Peer Reviewed
1
Copyright
Elsevier
Comments
This article was originally published in Journal of Economic Behavior & Organization, volume 74, issue 3, in 2010.
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