Benjamin Powell wrote in Private Property Rights, Economic Freedom, and Well Being:
The question of why some countries are rich, and others are poor, is a question
that has plagued economists at least since 1776, when Adam Smith wrote An Inquiry into the Nature and Causes of the Wealth of Nations. Some countries that have a wealth of human and natural resources remain in poverty (in Sub-Saharan Africa for example) while other countries with few natural resources (like Hong Kong) flourish.
An understanding of how private property and economic freedom allow people to
coordinate their activities while engaging in trades that make them both people better off, gives us an indication of the institutional environment that is necessary for prosperity. Observation of the countries around the world also indicates that those countries with an institutional environment of secure property rights and high degrees of economic freedom have achieved higher levels of the various measures of human well being.Property Rights and Voluntary Interaction
The freedom to exchange allows individuals to make trades that both parties
believe will make them better off. Private property provides the incentives for
individuals to economize on resource use because the user bears the costs of their actions. When private property is combined with market exchange, the price system that results provides the information and incentives for the many anonymous individuals in society to coordinate their activities to channel available resources to the people with the most urgent demand for them.Private property forces individuals to bear the costs of their actions.
Without private ownership, when a person uses resources, they impose a cost on everyone else in society. Economists call this the “tragedy of the commons.” Communal property leads to over use, and depletion of resources. Once property is privatized and individually held, the owner may use the property for his own benefit but he also directly incurs the cost of using it. Private property provides an incentive to conserve resources and maintain capital for future production….
WORKING PAPER
https://www.mercatus.org/system/files/Private-Property-Rights-Economic-Freedom-and-Well-Being.pdf
Science Daily reported in Private property, not productivity, precipitated Neolithic agricultural revolution:
Humankind first started farming in Mesopotamia about 11,500 years ago. Subsequently, the practices of cultivating crops and raising livestock emerged independently at perhaps a dozen other places around the world, in what archaeologists call the Neolithic Agricultural Revolution. It’s one of the most thoroughly-studied episodes in prehistory — but a new paper in the Journal of Political Economy shows that most explanations for it don’t agree with the evidence, and offers a new interpretation.
With farming came a vast expansion of the realm over which private property governed access to valued goods, replacing the forager social norms around sharing food upon acquisition. A common explanation is that farming increased labor productivity, which then encouraged the adoption of private property by providing incentives for the long-term investments required in a farming economy.
“But it’s not what the data are telling us,” says Santa Fe Institute economist Samuel Bowles, a co-author of the paper. “It is very unlikely that the number of calories acquired from a day’s work at the advent of farming made it a better option than hunting and gathering and it could well have been quite a bit worse.”
Prior studies, including those of human and animal bones, suggest that farming actually took an extreme nutritional toll on early adopters and their livestock. So why farm in the first place?
Some have suggested an inferior technology could have been imposed by political elites as a strategy for extracting taxes, tribute, or rents. But farming was independently adopted millennia before the emergence of governments or political elites capable of imposing a new way of life on heavily-armed foraging communities.
Bowles and co-author Jung-Kyoo Choi, an economist at Kyungpook National University in South Korea, use both evolutionary game theory and archaeological evidence to propose a new interpretation of the Neolithic. Based on their model, a system of mutually recognized private property rights was both a precondition for farming and also a means of limiting costly conflicts among members of a population. While rare among foragers, private property did exist among a few groups of sedentary hunter-gatherers. Among them, farming could have benefited the first adopters because it would have been easier to establish the private possession of cultivated crops and domesticated animals than for the diffuse wild resources on which hunter-gatherers relied….
https://www.sciencedaily.com/releases/2019/10/191011131858.htm
Citation:
Private property, not productivity, precipitated Neolithic agricultural revolution
Date: October 11, 2019
Source: Santa Fe Institute
Summary:
The Neolithic Agricultural Revolution is one of the most thoroughly-studied episodes in prehistory. But a new article shows that most explanations for it don’t agree with the evidence, and offers a new interpretation.Journal Reference:
Samuel Bowles, Jung-Kyoo Choi. The Neolithic Agricultural Revolution and the Origins of Private Property. Journal of Political Economy, 2019; 127 (5): 2186 DOI: 10.1086/701789
Here is the press release from the Santa Fe Institute:
OCTOBER 10, 2019
Humankind first started farming in Mesopotamia about 11,500 years ago. Subsequently, the practices of cultivating crops and raising livestock emerged independently at perhaps a dozen other places around the world, in what archaeologists call the Neolithic Agricultural Revolution. It’s one of the most thoroughly-studied episodes in prehistory — but a new paper in the Journal of Political Economy shows that most explanations for it don’t agree with the evidence, and offers a new interpretation.
With farming came a vast expansion of the realm over which private property governed access to valued goods, replacing the forager social norms around sharing food upon acquisition. A common explanation is that farming increased labor productivity, which then encouraged the adoption of private property by providing incentives for the long-term investments required in a farming economy.
“But it’s not what the data are telling us”, says Santa Fe Institute economist Samuel Bowles, a co-author of the paper. “It is very unlikely that the number of calories acquired from a day’s work at the advent of farming made it a better option than hunting and gathering and it could well have been quite a bit worse.”
Prior studies, including those of human and animal bones, suggest that farming actually took an extreme nutritional toll on early adopters and their livestock. So why farm in the first place?
Some have suggested an inferior technology could have been imposed by political elites as a strategy for extracting taxes, tribute, or rents. But farming was independently adopted millennia before the emergence of governments or political elites capable of imposing a new way of life on heavily-armed foraging communities.
Bowles and co-author Jung-Kyoo Choi, an economist at Kyungpook National University in South Korea, use both evolutionary game theory and archaeological evidence to propose a new interpretation of the Neolithic. Based on their model, a system of mutually recognized private property rights was both a precondition for farming and also a means of limiting costly conflicts among members of a population. While rare among foragers, private property did exist among a few groups of sedentary hunter-gatherers. Among them, farming could have benefited the first adopters because it would have been easier to establish the private possession of cultivated crops and domesticated animals than for the diffuse wild resources on which hunter-gatherers relied.
“It is a lot easier to define and defend property rights in a domesticated cow than in a wild kudu,” says Choi. “Farming initially succeeded because it facilitated a broader application of private property rights, not because it lightened the toil of making a living.”
Read the paper, “The Neolithic Agricultural Revolution and the Origins of Private Property,” in the Journal of Political Economy (October 2019) https://www.journals.uchicago.edu/doi/10.1086/701789
Tom DeWeese wrote in Private Property Ownership Is the Only Way to Eradicate Poverty:
Poverty. It’s the excuse for nearly every government spending program. Help the poor. Tax the Rich. Get the One Percent. How dare they get so wealthy while everyone else suffers!
And what is the preferred way to eliminate poverty? Redistribution of wealth. It is the force behind the Occupy Wall Street movement, Agenda 21 and its Social Justice schemes, nearly every poverty program of the Federal government, and even most charitable poverty programs….
The Real Way to End PovertyIt is becoming increasingly clear that poverty will never be eradicated unless those working on the problem will allow themselves to look for a drastically new way to attack it. Simply put, rather than constantly applying band-aids to the effects of poverty, they must look for the cause and fix it.
One must first look at the world and see where wealth is created and why it is so. The greatest example of wealth creation is obviously the United States. It is the beacon of wealth and freedom for the entire world. Most people in the world envy America’s wealth and seek ways to share it, yet very few look at how the nation got its wealth, or attempt to copy its system for success.
Why did the United States become so wealthy? Was it the possession of vast natural resources? Africa has more. Was it the existence of greater industry? Japan has more. Was it the existence of a superior education system? The United States now ranks below the top ten nations in education.
The reason the United States has led the world in wealth, standard of living, and abundance is that the average resident of the United States has had the ability and the opportunity to invest and produce capital.
Why could ordinary citizens of the United States produce their own capital to create personal wealth, while most of the rest of the world failed at such an attempt? The answer is actually very simple. The United States created a very easy, immediate, complete system for recording and securing ownership of private property.
Peruvian economist Hernando de Soto explains the root of American wealth in his book, The Mystery of Capital. De Soto asks, “Why does Capitalism thrive only in the West, as if enclosed in a bell jar?”
Capital, he argues, “is the force that raises the productivity of labor and creates the wealth of nations, It is the lifeblood of the capitalist system, the foundation of progress, and the one thing that the poor countries of the world cannot seem to produce for themselves….”
https://www.thenewamerican.com/reviews/opinion/item/13821-private-property-ownership-is-the-only-way-to-eradicate-poverty
See, Reasons for Low Capital Formation in Under-Developed Countries http://www.economicsdiscussion.net/articles/reasons-for-low-capital-formation-in-under-developed-countries/1537
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