Property

From Wikinvestor

Property is any physical or virtual entity that is owned by an individual or jointly by a group of individuals. An owner of property has the right to consume, sell, rent, mortgage, transfer and exchange his or her property. Important types of property include real property (land), personal property (other physical possessions), and arguably intellectual property (rights over artistic creations, inventions, etc.). A title, or a right of ownership, is associated with property that establishes the relation between the goods/services and other individuals or groups, assuring the owner the right to dispense with the property in a manner he or she sees fit. Some philosophers assert that property rights arise from social convention. Others find origins for them in morality or natural law (e.g. Saint Irenaeus).

Contents 1 Use of the term 2 General characteristics 2.1 Ancient philosophy 3 Types of property 4 What can be property? 4.1 Rights of use as property 5 Who can be an owner? 6 Whether and to what extent the State may interfere with property 7 References 8 References 9 External links and references

Use of the term

Various scholarly communities (e.g., law, economics, anthropology, sociology) may treat the concept more systematically, but definitions vary within and between fields. Scholars in the social sciences frequently conceive of property as a bundle of rights. They stress that property is not a relationship between people and things, but a relationship between people with regard to things.

Public property is any property that is controlled by a state or by a whole community. Private property is any property that is not public property. Private property may be under the control of a single individual or by a group of individuals collectively.^[1] Some philosophers like Karl Marx use it to describe a social relationship between those who sell their labor power and those who buy it.

General characteristics

Modern property rights conceive of ownership and possession as belonging to legal individuals, even if the legal individual is not a real person. Corporations, for example, have legal rights similar to American citizens, including many of their constitutional rights. Therefore, the corporation is a juristic person or artificial legal entity, which some refer to as "corporate personhood".

Property rights are protected in the current laws of states usually found in the form of a Constitution or a Bill of Rights. The fifth and the fourteenth amendments to the United States constitution, for example, provide explicitly for the protection of private property:

The Fifth Amendment states:

Nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.

The Fourteenth Amendment states:

No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law.

Protection is also found in the United Nations's Universal Declaration of Human Rights, Article 17, and in the French Declaration of the Rights of Man and of the Citizen, Article XVII, and in the European Convention on Human Rights (ECHR), Protocol 1.

Property is usually thought of in terms of a bundle of rights as defined and protected by the local sovereignty. Ownership, however, does not necessarily equate with sovereignty. If ownership gave supreme authority it would be sovereignty, not ownership. These are two different concepts.

Traditional principles of property rights includes:

1. control of the use] of the property
2. the right to any benefit from the property (examples: mining rights and rent)
3. a right to transfer or sell the property
4. a right to exclude others from the property.

Traditional property rights do not include:

1. uses that unreasonably interfere with the property rights of another private party (the right of quiet enjoyment).
2. uses that unreasonably interfere with public property rights, including uses that interfere with public health, safety, peace or convenience.

Legal systems have evolved to cover the transactions and disputes which arise over the possession, use, transfer and disposal of property, most particularly involving contracts. Positive law defines such rights, and a judiciary is used to adjudicate and to enforce.

In his classic text, "The Common Law", Oliver Wendell Holmes describes property as having two fundamental aspects. The first is possession, which can be defined as control over a resource based on the practical inability of another to contradict the ends of the possessor. The second is title, which is the expectation that others will recognize rights to control resource, even when it is not in possession. He elaborates the differences between these two concepts, and proposes a history of how they came to be attached to individuals, as opposed to families or entities such as the church.

According to Adam Smith, the expectation of profit from "improving one's stock of capital" rests on private property rights. It is a belief central to capitalism that property rights encourage the property holders to develop the property, generate wealth, and efficiently allocate resources based on the operation of the market. From this evolved the modern conception of property as a right which is enforced by positive law, in the expectation that this would produce more wealth and better standards of living.

Ancient philosophy

Urukagina, the king of the Sumerian city-state Lagash, established the first laws that forbade compelling the sale of property. The Cyrus cylinder of Cyrus the Great, founder of the Achaemenid Persian Empire, documents the protection of property rights.^[2]

The Ten Commandments]] shown in Exodus 20:2-17 and Deuteronomy 5:6-21 stated that the Israelites were not to steal. These texts, written in approximately 1300 B.C., were a blanket early protection of private property.

Aristotle, in Politics, advocates "private property." In one of the first known expositions of tragedy of the commons he says, "that which is common to the greatest number has the least care bestowed upon it. Every one thinks chiefly of his own, hardly at all of the common interest; and only when he is himself concerned as an individual." In addition he says that when property is common, there are natural problems that arise due to differences in labor: "If they do not share equally enjoyments and toils, those who labor much and get little will necessarily complain of those who labor little and receive or consume much. But indeed there is always a difficulty in men living together and having all human relations in common, but especially in their having common property." (Politics, 1261b34)

Types of property

Most legal systems distinguish different types (immovable property, estate in land, real estate, real property) of property, especially between land and all other forms of property - goods and chattels, movable property or personal property. They often distinguish tangible and intangible property (see below).

One categorization scheme specifies three species of property: land, improvements (immovable man made things) and personal property (movable man made things)

In common law, real property (immovable property) is the combination of interests in land and improvements thereto and personal property is interest in movable property.

'Real property' rights are rights relating to the land. These rights include ownership and usage. Owners can grant rights to persons and entities in the form of leases, licenses and easements.

Later, with the development of more complex forms of non-tangible property, personal property was divided into tangible property (such as cars, clothing], etc.) and intangible property (such as financial instruments, including stocks and bonds, etc.), and intellectual property, including (patents, copyrights, and trademarks).

What can be property?

The two major justifications given for original property, or homesteading, are effort and scarcity. John Locke emphasized effort, "mixing your labor" with an object, or clearing and cultivating virgin land. Benjamin Tucker preferred to look at the telos of property, i.e. What is the purpose of property? His answer: to solve the scarcity problem. Only when items are relatively scarce with respect to people's desires do they become property.[1] For example, hunter-gatherers did not consider land to be property, since there was no shortage of land. Agrarian societies later made arable land property, as it was scarce. For something to be economically scarce, it must necessarily have the exclusivity property - that use by one person excludes others from using it. These two justifications lead to different conclusions on what can be property. Intellectual property - non-corporeal things like ideas, plans, orderings and arrangements (musical compositions, novels, computer programs) - are generally considered valid property to those who support an effort justification, but invalid to those who support a scarcity justification (since they don't have the exclusivity property.) Thus even ardent propertarians may disagree about IP.[2] By either standard, one's body is one's property.

From some anarchist points of view, the validity of property depends on whether the "property right" requires enforcement by the state. Different forms of "property" require different amounts of enforcement: intellectual property requires a great deal of state intervention to enforce, ownership of distant physical property requires quite a lot, ownership of carried objects requires very little, while ownership of one's own body requires absolutely no state intervention.

Many things have existed that did not have an owner, sometimes called the commons. The term "commons," however, is also often used to mean something quite different: "general collective ownership" - i.e. common ownership. Also, the same term is sometimes used by statists to mean government-owned property that the general public is allowed to access. Law in all societies has tended to develop towards reducing the number of things not having clear owners. Supporters of property rights argue that this enables better protection of scarce resources, due to the tragedy of the commons, while critics argue that it leads to the exploitation of those resources for personal gain and that it hinders taking advantage of potential network effects. These arguments have differing validity for different types of "property" -- things which are not scarce are, for instance, not subject to the tragedy of the commons. Some apparent critics actually are advocating general collective ownership rather than ownerlessness.

Things today which do not have owners include: ideas (except for intellectual propert]), seawater (which is, however, protected by anti-pollution laws), parts of the seafloor (see the United Nations Convention on the Law of the Sea for restrictions), gasses in Earth's atmosphere, animals in the wild (though there may be restrictions on hunting etc. -- and in some legal systems, such as that of New York, they are actually treated as government property), celestial bodies and outer space, and land in Antarctica.

The nature of children under the age of majority is another contested issue here. In ancient societies children were generally considered the property of their parents. Children in most modern societies theoretically own their own bodies -- but they are considered incompetent to exercise their rights, and their parents or guardians are given most of the actual rights of control over them.

Questions regarding the nature of ownership of the body also come up in the issue of abortion and drugs.

In many ancient legal systems (e.g. early Roman law), religious sites (e.g. temples) were considered property of the God or gods they were devoted to. However, religious pluralism makes it more convenient to have religious sites owned by the religious body that runs them.

Intellectual property and air (airspace, no-fly zone, pollution laws, which can include tradeable emissions rights) can be property in some senses of the word.

Rights of use as property

Ownership of land can be held separately from the ownership of rights over that land, including sporting rights[3], mineral rights, development rights, air rights, and such other rights as may be worth segregating from simple land ownership.

Who can be an owner?

Ownership laws may vary widely among countries depending on the nature of the property of interest (e.g. firearms, real property, personal property, animals). In some societies only adult men may own property. In many societies legal entities, such as corporations, trusts, and nations (or governments) own property.

In the Inca empire, the dead emperors, who were considered gods, still controlled property after death.^[3].

Whether and to what extent the State may interfere with property

Under United States law the principal limitations on whether and the extent to which the State may interfere with property rights are set by the Constitution. The "Takings" clause requires that the government (whether state or federal----for the 14th Amendment's due process clause imposes the 5th Amendment's takings clause on state governments) may take private property only for a public purpose, after exercising due process of law, and upon making "just compensation." If an interest is not deemed a "property" right, or the conduct is merely an intentional tort, these limitations do not apply and the doctrine of sovereign immunity precludes relief.^[4] Moreover, if the interference does not almost completely make the property valueless, the interference will not be deemed a taking but instead a mere regulation of use.^[5] On the other hand, some governmental regulations of property use have been deemed so severe that they have been considered "regulatory takings."^[6] Moreover, conduct sometimes deemed only a nuisance or other tort has been held a taking of property where the conduct was sufficiently persistent and severe.^[7]

References

References

• Frédéric Bastiat, 1850. Economic Harmonies. W. Hayden Boyers, trans.; George B. de Huszar, ed. Liberty Fund.
• Dean Russell, "The Law", 1850.
• Tom Bethell, 1998. The Noblest Triumph: Property and Prosperity through the Ages. New York: St. Martin's Press.
• William Blackstone, 1765-69. Commentaries on the Laws of England, 4 vols. Oxford Univ. Press. Especially Books the Second and Third.
• Hernando De Soto, 1989. The Other Path. Harper & Row.
• Hernando De Soto and Francis Cheneval, 2006. Realizing Property Rights. Ruffer & Rub.
• Richard Pipes, 1999. Property and Freedom.
• Mckay, John P. , 2004, "A History of World Societes". Boston: Houghton Mifflin Company

External links and references

• Property Law Case Summaries
• Private Property, Freedom, and the Rule of Law
• "Right to Private Property", Tibor Machan, Internet Encyclopedia of Philosophy
• "The Ethics and Economics of Private Property", Hans-Hermann Hoppe, van Mises Institute