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Colombatto, Enrico --- "Introduction" [2004] ELECD 97; in Colombatto, Enrico (ed), "The Elgar Companion to the Economics of Property Rights" (Edward Elgar Publishing, 2004)

Book Title: The Elgar Companion to the Economics of Property Rights

Editor(s): Colombatto, Enrico

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781840649949

Section Title: Introduction

Author(s): Colombatto, Enrico

Number of pages: 18

Extract:

Introduction
Enrico Colombatto


On property rights and economic analysis
The role of property rights in economics can hardly be overemphasised.
Indeed, since all the essential controversies about the purpose and nature of
economic science can be reformulated as debates on the features of indi-
vidual behaviour (consumption, production, leisure, policy making), and since
the motivation and opportunities for human action are defined by systems of
property rights, it is fair to say that economic analysis is about the conse-
quences of the assignment and use of property. Of course, economics still
remains a question of scarcity, as individuals try to enhance their well-being
in a world characterised by ignorance and limited resources. But the very
concept of scarcity would make little sense unless the idea of property were
taken into account, for property rights define the structure of incentives that
lead agents to struggle, compete and also cooperate in order to satisfy their
needs and ambitions. Indeed, property rights characterise scarcity itself, which
becomes a meaningful concept only if the possibility of using ­ or benefiting
from ­ a given good is related to how much one gains by transferring
(acquiring) those rights to (from) others.
This view is now commonly accepted; even by those who favour techno-
cratic approaches based on formal models where institutions hardly play a
role. Contrary to common belief, however, the link between economic per-
formance and property rights goes well beyond the standard problems of
static optimisation, whereby supposedly efficient techniques are necessarily
adopted and ...