John Locke enunciates an intriguing principle to govern property rights in section 27 of his 2d Treatise on Government: “Of Civil Government” (Chapter V "Of Property"):
Though the earth, and all inferior creatures, be common to all men, yet every man has a property in his own person: this no body has any right to but himself. The labour of his body, and the work of his hands, we may say, are properly his. Whatsoever then he removes out of the state that nature hath provided, and left it in, he hath mixed his labour with, and joined to it something that is his own, and thereby makes it his property. It being by him removed from the common state nature hath placed it in, it hath by this labour something annexed to it, that excludes the common right of other men: for this labour being the unquestionable property of the labourer, no man but he can have a right to what that is once joined to, at least where there is enough, and as good, left in common for others.
The starting place for John Locke's argument seems sound:
People have a property right in their own bodies.
To the extent possible, people should have a property right in their own labor.
The difficulty that John Locke does his best to minimize is this: what if my labor modifies something to which I did not have a property right? Then
if the modified thing is made mine, I have arrogated to myself something that was not mine by "mixing it with my labor";
if the modified thing is not made mine, then the labor I have put into modifying it has been taken away from me.
John Locke supposes that there are plenty of things available that have not been mixed with anyone's labor, so I might as well be given that thing that was not mine if I mix my labor with it. Yes it was not mine and now it is mine, but anyone else can get one if they want, John Locke argues. But this is too optimistic. In the world of 2017, there is a shortage of attractive land that is unowned by anyone, and an even greater shortage of land over which no nation claims political dominion. Even when it comes to ideas, I might pluck an idea out of the Platonic realm and claim ownership of it by thinking about it a little bit, when given another week or another year you might have figured that idea out.
The marginalist theory has another proposed principle: whoever owns the thing to begin with, they should be willing to pay me the improvement in value from modifying it. The marginalist theory then has no theory at all for the ownership of things that are not themselves the results of someone's labor.
The Coasian principle is that if there were no frictions, it there would be Pareto efficiency regardless of how the property rights are assigned, but in practice, various frictions suggest who should own something in order to minimize the efficiency costs of those frictions. For example, it might be convenient, other things equal, to assign ownership of something to someone who is mixing labor with it in order to reduce transactions costs and any problems from imperfect competition. This is only one possibility when coming from a Coasian point of view, but it is a possibility in the direction of what John Locke is suggesting.
For an initial allocation of property when there really is an abundance of items that no-one has labored over, Locke's labor theory of property seems fine if one does not carefully think through what happens over time. But when items no-one has labored over will become scarce later on, that future scarcity cannot be ignored. Overall, Locke's labor theory of property seems like an excellent early attempt at a theory of property, but it is far from being a fully acceptable theory of property. It is well worth considering what other alternatives there are. I hope to return to this issue in future John Locke posts.
For links to other John Locke posts, see these John Locke aggregator posts: