National Theory (Economic Rights, Legal Rights, and the Scope of the State)

Author: Yoram Barzel (United States), translated by Qian Yong and Zeng Yongmei
Publisher:
Publishing Date: 2006-07-01
Features: This book models the birth of the state and the forces that shape it. The formation of the state stems from the need for protection. Professional protectors—the rulers—are efficient and self-interested. Rulers are only deployed when individuals create mechanisms to control them. The branches of organized protection are the legal system and decision-making procedures (including voting). Thus, the initial "natural state" gradually evolves into a rule-of-law state. The state endows individuals with rights by defining the scope of protection. However, implementation is never perfect. People also use other third parties—such as businesses—to enforce agreements. The combination of enforcement methods chosen in practice determines the scale of state policy and the characteristics of the state. As products become standardized, the economies of scale in contracting also increase. We argue that the state expands its contracting enforcement domain through treaties or conquest to leverage domestic enforcement economies of scale. The demand to expand the contracting enforcement domain also explains the rise of rule-of-law empires.
Yoram Barzel graduated from the Hebrew University and the University of Chicago. Since 1967, he has been teaching at the University of Washington, where he is a professor of economics. His research spans applied price theory, property rights economics, and has recently shifted to political economy. His current research focuses on the birth of the state, with his models applied to medieval England and France. He has published numerous articles in major economics journals, and in 1995, his papers were included in Edward Elgar Publishing's "20th Century Economists" series. His book, Economic Analysis of Property Rights (Cambridge University Press), has been released in its second edition. Professor Barzel is the president of the Western Economic Association.
This book models the birth of the state and the forces that shape it. The formation of the state stems from the need for protection. Professional protectors—the rulers—are efficient and self-interested. Rulers are only deployed when individuals create mechanisms to control them. The branches of organized protection are the legal system and decision-making procedures (including voting). Thus, the initial "natural state" gradually evolves into a rule-of-law state. The state endows individuals with rights by defining the scope of protection. However, implementation is never perfect. People also use other third parties—such as businesses—to enforce agreements. The combination of enforcement methods chosen in practice determines the scale of state policy and the characteristics of the state. As products become standardized, the economies of scale in contracting also increase. We argue that the state expands its contracting enforcement domain through treaties or conquest to leverage domestic enforcement economies of scale. The demand to expand the contracting enforcement domain also explains the rise of rule-of-law empires.