Proprietary Policy and Production

Abstract

I present a model of a proprietary regime with opportunities for direct production (e.g., plantation cultivation, mining extraction). The premise is that direct production is a superior method of appropriation than taxation. The tax and spending policy of the regime distorts the resource allocation in favor of direct production and at a loss of private production; the welfare of the population suffers while the regime benefits. I examine the relevance of the model to the policies of actual proprietary regimes.