Government vs. Governance: Libertarianism and Private Communities

Journal of Private Enterprise, 2018, Forthcoming

19 Pages Posted: 2 Jan 2018 Last revised: 29 Apr 2018

See all articles by Michael Makovi

Michael Makovi

Texas Tech University, College of Agricultural Sciences and Natural Resources, Department of Agricultural and Applied Economics; Texas Tech University - Free Market Institute

Date Written: April 7, 2018

Abstract

Libertarians tend to oppose hierarchical authority, and advocate the privatization of public goods. However, not all collective action problems can be solved so easily; collective problems may require collective solutions. Fortunately, the essence of the market process is not the atomic individual, but consent. Libertarians should endorse hierarchical, bureaucratic solutions as long as membership is voluntary. We provide a general theory of the proprietary community as a solution to collective action problems: such a community embodies consent, jurisdictional competition, and residual claimancy (incentive alignment), mitigating collective action problems in a hierarchical and consensual – but nevertheless market-based – manner.

Keywords: private community, proprietary governance, homeowners association, anarchism, anarcho-capitalism

JEL Classification: B53, H11, H41, D71, A13

Suggested Citation

Makovi, Michael, Government vs. Governance: Libertarianism and Private Communities (April 7, 2018). Journal of Private Enterprise, 2018, Forthcoming. Available at SSRN: https://ssrn.com/abstract=3095783 or http://dx.doi.org/10.2139/ssrn.3095783

Michael Makovi (Contact Author)

Texas Tech University, College of Agricultural Sciences and Natural Resources, Department of Agricultural and Applied Economics ( email )

Box 42132
Lubbock, TX 79409-2132
United States

Texas Tech University - Free Market Institute ( email )

Box 45059
Lubbock, TX 79409-5059
United States

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