Property rights theory simplified complex institutions to prepare New Institutional Economics

Evidence

The property rights literature provided a way for economists to acknowledge the role of corporations, governments, and other complex arrangements of agency and power, by simplifying them into individual actors governed by rules of property. It identified the absence of private property rights or the existence of communal rights as a source of uncertainty and potential instability. This work of simplification prepared the ground for the development of New Institutional Economics, which became a major branch of neoliberal thought. — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 1931

Categorization

• XREF: Connects to North (1981, 1990) institutional economics and the general arc from property-rights paradigm to NIE that later shaped development policy and the Washington Consensus. — connects to: Property rights theory flowed from academia through Peru to the World Bank and Egypt. — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 164; Ordoliberalism’s Ordnungstheorie anticipated modern neo-institutionalist economics — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin: The Making…, 559; Economic property rights persist independent of legal recognition
• QUESTION: Worth chasing: how exactly did Alchian and Demsetz’s RAND-era corporate governance work translate into the ‘property rights paradigm’ as a development doctrine?

Broader Connections

• Ordoliberalism’s Ordnungstheorie anticipated modern neo-institutionalist economics #expands (0.85) — Philip Mirowski & Dieter Plehwe (eds.), The Road from Mont Pèlerin, 559
• Economic property rights persist independent of legal recognition #expands (0.80)