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The Market Mechanism of Appropriation

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  • Ellerman David

    (University of California, Riverside)

Abstract

A theory of property needs to give an account of the whole life-cycle of a property right: how it is initiated, transferred, and terminated. Economics has focused on the transfers in the market and has almost completely neglected the question of the initiation and termination of property in normal production and consumption. Yet the market also provides a laissez-faire mechanism: when the legal authorities do not intervene (let it be), then the initial right is, in effect, assigned to the first seller and the terminal liability to the last buyer. But does this mechanism satisfy the juridical principle of responsibility: assign de jure responsibility in accordance with de facto responsibility? The fundamental theorem states that if all transfers are covered by voluntary contracts and all contracts are fulfilled, then the laissez-faire mechanism satisfies the responsibility principle.Une théorie de la propriété se doit dexpliquer entièrement le cycle de vie du droit de propriété: les conditions de son émergence, de son transfert et de sa résiliation. La théorie économique sest focalisée sur les mécanismes de transferts sur le marché et a presque totalement négligé la question de lémergence et de la réalisation de la propriété dans les phénomènes de production et de consommation. Pourtant, le marché fournit également un mécanisme de laissez-faire: lorsque les autorités légales sabstiennent dintervenir (laissez-faire), le droit initial est affecté au premier vendeur et la responsabilité terminale au dernier acheteur. Néanmoins, ce mécanisme satisfait-il le principe juridique de responsabilité? A savoir, assigner une responsabilité de jure en accord avec le principe de responsabilité de facto? En effet, le théorème fondamental exprime qui si tous les transferts seffectuent par des contrats volontaires, et que tous les contrats sont remplis, alors le principe du laissez-faire satisfait le principe de responsabilité.

Suggested Citation

  • Ellerman David, 2004. "The Market Mechanism of Appropriation," Journal des Economistes et des Etudes Humaines, De Gruyter, vol. 14(2), pages 1-21, December.
  • Handle: RePEc:bpj:jeehcn:v:14:y:2004:i:2:n:3
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    References listed on IDEAS

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    1. Hart, Oliver & Moore, John, 1990. "Property Rights and the Nature of the Firm," Journal of Political Economy, University of Chicago Press, vol. 98(6), pages 1119-1158, December.
    2. Umbeck, John, 1981. "Might Makes Rights: A Theory of the Formation and Initial Distribution of Property Rights," Economic Inquiry, Western Economic Association International, vol. 19(1), pages 38-59, January.
    3. Merton H. Miller & Franco Modigliani, 1961. "Dividend Policy, Growth, and the Valuation of Shares," The Journal of Business, University of Chicago Press, vol. 34, pages 411-411.
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    Cited by:

    1. Ellerman, David, 2010. "Marxism as a capitalist tool," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 39(6), pages 696-700, December.

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