Scholarly Comments on Academic Economics

Bundle-of-Sticks Notions in Legal and Economic Scholarship

by

Abstract

The phrase “bundle of rights” does not serve as an accurate conceptual definition of property. Nor has that phrase provided a helpful metaphor as used in Ronald Coase’s article “The Problem of Social Cost” (1960) and subsequent legal and economic scholarship. Coase’s usage portrays property rights as a collection of individualized permissions to use an asset, when in sound conceptual usage “property” signifies a domain of authority to decide how to use the asset. The “bundle” metaphor may be understood to state that an owner has a right to deploy his property in any specific manner fairly implied by his general rights of ownership. Although this metaphorical usage is helpful, it remains parasitic on a sound conceptual definition of property. Property is best conceived of as a right securing a normative interest in determining exclusively the use of an asset external to the person of the owner.

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Volume (Issue)
Pages
205-214
Published
JEL classification
A1, K00, K1
Keywords
Property, bundle of rights, exclusion, exclusivity, right to exclude, legal realism, law and economics, Wesley Hohfeld, Richard Posner, Harold Demsetz, Armen Alchian, Thomas Merrill, Henry Smith, private law theory, conceptual philosophy
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