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The State’s Enforcement Monopoly and the Private Protection of Property

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  • Christoffel Grechenig

    ()
    (Max Planck Institute for Research on Collective Goods, Bonn)

  • Martin Kolmar

    ()
    (Institute of Economics, University of St. Gallen)

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    Abstract

    The modern state has monopolized the legitimate use of force. This concept is twofold. First, the state is empowered with enforcement rights; second, the rights of the individuals are (partly) restricted. In a simple model of property rights with appropriation and defense activity, we show that a restriction of private enforcement is beneficial for the property owner, even if there are no economies of scale from public protection. We emphasize the role of the state as a commitment device for a certain level of enforcement. However, commitment will only work if the state can regulate private protection. A ban of private enforcement measures can even be beneficial in situations where there would be no private enforcement at first place because the “shadow” of defense has a negative impact on the investments in property rights infringements. From a legal perspective, our approach emphasizes a regulation of victim behavior as opposed to the standard approach which focuses on the regulation of criminal behavior.

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    Bibliographic Info

    Paper provided by Max Planck Institute for Research on Collective Goods in its series Working Paper Series of the Max Planck Institute for Research on Collective Goods with number 2011_24.

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    Date of creation: Sep 2011
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    Handle: RePEc:mpg:wpaper:2011_24

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    Keywords: Contests; Property Rights; Enforcement; Private Protection; Law;

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    1. Boldrin, Michele & Levine, David, 2002. "The Case Against Intellectual Property," CEPR Discussion Papers 3273, C.E.P.R. Discussion Papers.
    2. Martin Kolmar, 2008. "Perfectly Secure Property Rights and Production Inefficiencies in Tullock Contests," Southern Economic Journal, Southern Economic Association, vol. 75(2), pages 441-456, October.
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    Cited by:
    1. Ours, J.C. van & Vollaard, B.A., 2013. "The Engine Immobilizer: a Non-Starter For Car Thieves," Discussion Paper 2013-004, Tilburg University, Center for Economic Research.
    2. Baumann, Florian & Friehe, Tim, 2013. "Private protection against crime when property value is private information," International Review of Law and Economics, Elsevier, vol. 35(C), pages 73-79.

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