#10932 - Property Outline Wiener Copy - Property

POLICY, RATIONALES 3

1. Rationales for property 3

1.1 Labor theory - Locke, Second Treatise on Government 3

1.2 Personhood theory - Radin 3

1.3 Distributive justice - Rawls, Wilson 4

1.4 Utilitarianism - Bentham, Posner 4

1.5 Autonomy/ Freedom - Charles Reich 5

1.6 Tragedy of the Commons (Hardin) 5

2. Property and prosperity - Do Utilitarian Property Rights Work? 6

3. Problems with Private Property 7

4. Evolution of property rights 8

5. Evolution of property rights Indians and European Settlers) 11

ACQUISITION 14

1. Introduction 14

2. Wild animals 14

3. America 17

4. Oil and water 18

5. Intellectual property 20

5.1 Introduction 20

5.2 Patent 21

5.3 Copyright 22

5.4 News, music, persona, etc. 24

5.5 Alternatives to Intellectual Property 25

6. Adverse possession 26

7. Finders 28

FORMS OF OWNERSHIP 29

1. Present interests - Fee simple, life estates, defeasible fees 29

2. Future interest 31

3. RAP and Rule against restraints on alienation 32

4. Buying a house 35

5. Concurrent interests 35

LANDLORD TENANT LAW 39

1. LL’s rights and remedy 39

2. T’s rights and remedy 40

CONFLICTING RIGHTS 43

Judicial rules 43

1. Externalities, Transaction Costs, and Remedies 43

2. Trespass, Nuisance, and Remedies 44

Neighbor’s rule 46

3. Social Norms 46

4. Easement 48

5. Real Covenant 50

6. Equitable servitudes 53

7. Home owner association 53

Administrative rule 54

8. Zoning 54

9. Takings 56

1. Every person owns his body. Thus, each person owns the labor that his body performs. So when a person labors to change something in nature for his benefit, he mixes his labor with the thing, and by this mixing process, he thereby acquires rights in the thing.

   1. Examples: cultivation, ideas, discovery

2. Limits on the labor theory

   1. The degree of labor required is uncertain. The theory should permit a person to receive the value that his or her labor adds to a thing, not title to the thing itself.

   2. It is not clear whether or not we really own ourselves. We cannot sell our organs and we do not have full autonomy. We cannot sell certain types of our labor such as sex.

   3. Where there are multiple laborers, the theory does not provide a method to apportion the property.

   4. They may be ownership without use, such as natural conservatory

   5. Sufficiency condition: labor vests ownership where there is enough, and as good as left in common for others. This condition can only be satisfied if labor enlarges the pie. In this sense the labor theory is similar to utilitarianism.

1. The purpose of law should be to promote flourishing and dignity of the individual.

2. Personhood spectrum:

   1. fetish (care so much of property relationship that it is unhealthy)

   2. personal (property essential to your flourishing as individual)

   3. fungible (indifferent between that property or cash)

3. 5^th amendment “takings with just compensation” does not privilege personal property. However, some parts of the personhood theory is reflected in law: 3^rd amendment (special protection for private homes against government quartering soldiers) and 13^th amendment (prohibiting involuntary servitude/slavery)

4. Problems:

   1. The personhood theory is too subjective, it is difficult to measure and prove. A ring could be fungible to someone, personal to others, and fetish to yet some other people

   2. Too anthropocentric – interpreting everything in terms of human experiences and values

1. Focused on community, not individual

2. Maximin principle: maximize the welfare of the least well-off : distribution of “primary goods” (wealth, income, opportunities for work/leisure, and bases of self-respect) should be of maximal advantage to the least advantaged social class

3. Problems

   1. Total social value (aggregate welfare) is not always maximized; instead, might be better to take utilitarian approach and partly redistribute the greater aggregate gain to compensate the least well-off

   2. Loss of incentive to produce

   3. It’s difficult to define primary goods

   4. Conflicting sense of what is just (veil of ignorance)

      1. Assumes we are averse to risk (want to make bottom as attractive as possible in case you end up there)

      2. However, a just society is one in which inequalities in wealth are acceptable as long as direct correlation to effort and skill (match rewards to contribution)

1. Focused on community, not individual

2. Society’s goal should be greatest happiness for the greatest number – maximize aggregate utility (Bentham) – Democratizing Idea

3. Consequentialist Framework: what is morally good = what produces utility

4. Problems:

   1. Whose values count?

      1. Even if the size of the pie increases, the size of each person’s pie does not necessarily increase. Utilitarianism may tend to perpetuate the existing unequal distribution of wealth.

   2. How do we measure utility? Critics charge that utilitarian theory is effectively meaningless because it is impossible to assess happiness.

      1. Interpersonal utility comparisons – willingness to pay (WTP)

         1. Stated Preference (ask people) or Revealed Preference (observe people)

         2. Not true measure of utility (irrational behavior, lack of information about what paying for, WTP conditioned by ability to pay)

         3. WTP < WTA (willingness to accept): people feel great utility reduction to lose something. endowment effect; loss aversion

            1. Personhood explanation: we are more attached to what we already have

   3. Aggregate utility cannot necessarily justify a wrong. Utilitarianism for some people presents profound moral questions.

5. Bentham

   1. Property is social institution that is means to an end (maximizing social welfare).

   2. Property is expectation, relation, claim for enforcement – it is conceptual, metaphysical (not a preexisting natural right)

   3. Property and law “born together and die together”

   4. Reason for property law: Crucial for incentive to invest (utilitarian – dominant rationale for American property law)

      1. Law = Security = Incentive to invest

      2. Cooperation, reciprocity = law

   5. Without law, could only expect to keep what you can hang on to physically

6. Posner

   1. Legal protection of property rights has an economic function – to create incentives to use resources efficiently

   2. Three ideal conditions to maximize social utility of private property:

      1. Exclusivity: law recognizes the absolute right of an owner to exclude all memebers of society from the use or enjoyment of the owned resources.

         1. Without - could “reap where she has not sown”

         2. Thus, need as incentive to invest

      2. Transferability: property rights are freely transferable, so that a resource can be devoted to the most highly-valued use.

         1. Mutual gain (transfer to higher-value user on mutually favorable terms)

         2. Conservation (prospect of future sales gives incentive to conserve value of asset for others in future)

      3. Universality: all property is owned by someone

1. Property rights as a zone of individual autonomy against the society. The ownership of private property is necessary for democratic self-government. Property right provides citizens with the economic security that allows independent political judgment.

1. Commons “open access” yields overuse

   1. Race to capture – use it or lose it (X users, gain to user of added use = +1, cost to user of added use = -1/X – spread out over all users)

   2. External costs of depletion imposed on others (X-1)/X – incentive to continue using

      1. Right to exclude under utilitarianism internalizes these external costs

2. Examples:

   1. Collapse of a fishery – get benefit of the fish, but loss is spread over all users

   2. Climate change – atmosphere used as disposal site for greenhouse gases (costs borne by everyone whereas cost of purifying wastes before releasing is borne only by you)

3. Solutions - restricted access

   1. Divide property into private (excludable) spatial parcels (privatizing property): boundaries, fences. Right to exclude internalizes external costs.

   2. Divide property into private (excludable) use or access rights

      1. Cap and trade (cap limits the quantity of emissions, permits or allowances get more scarce and price will be set by market conditions), Quotas, Permits

      2. ITQs for fish, tradeable development rights in cities, tradeable emission rights for air pollution

   3. Charge price for access (force people to internalize the externality– amount of tax should be the marginal external harm)

      1. Tax to recover external harm; Liability

      2. Tolls on roads

1. Deacon

   1. Deforestation – property rights associated with less deforestation (encourage investment, conservation – will not forego current consumption for a future return without some assurance that future benefit will be received by party making sacrifice)

2. Acemoglu

   1. Do property rights encourage prosperity?

      1. Two Koreas

         1. Same history, culture, geography

         2. South – Market economy with property rights

         3. North – Socialist, no property rights

      2. Europe and its colonies

         1. North American colonies rich now because better property rights brought to America

            1. British better than French, Portuguese, Spanish – decentralization of power in England, but other countries had monarchies with more centralized power.

            2. North America settled by British (incentive to invest), whereas other countries just had resources extracted.

3. De Soto

   1. Prosperity in developing countries today

      1. Lots of resources, but no formal system of property rights

      2. Cannot borrow against property (no formal right to exclude,...