The State’s Enforcement Monopoly and the Private Protection of Property
28 Pages Posted: 6 May 2014
Date Written: October 1, 2011
The modern state has monopolized the legitimate use of force. This concept is twofold. First, the state is empowered with enforcement rights; second, the rights of the individuals are (partly) restricted. In a simple model of property rights with appropriation and defense activity, we show that a restriction of private enforcement is beneficial for the property owner, even if there are no economies of scale from public protection. We emphasize the role of the state as a commitment device for a certain level of enforcement. However, commitment will only work if the state can regulate private protection. A ban of private enforcement measures can even be beneficial in situations where there would be no private enforcement at first place because the 'shadow' of defense has a negative impact on the investments in property rights infringements. From a legal perspective, our approach emphasizes a regulation of victim behavior as opposed to the standard approach which focuses on the regulation of criminal behavior.
Keywords: contests, property rights, enforcement, private protection, law
JEL Classification: K42, P14, P37, P48, N40
Suggested Citation: Suggested Citation