ABSTRACT
Property rights define the economy. Economic exchange lies at the core of commercial activity. We trade real property and we exchange manufactured objects, services, intellectual goods, and other things. These forms of exchange are organized around, and made possible by, the parties’ property rights. These rights specify our prior holdings, the forms of exchange into which we can enter, and they protect what we might get out of the exchange. They define and protect the consumer’s purchase, the producer’s income, and the exchange itself. And a settled system of property determines when economic activity creates problematic externalities, what might be the appropriate scope of regulation, what are the limits of acceptable tax policy, and so on.
