The Economic Theory of Rights

RANDALL G. HOLCOMBE
JOURNAL OF INSTITUTIONAL ECONOMICS 10.3 (2014): 471-491

Abstract: People have rights to the degree that they are willing to claim them and are able to enforce them, either themselves or through a third-party enforcer. This economic theory of rights is based on the rights people actually do have and are able to exercise, not the rights they should have based on some normative criteria. Natural rights theories and contractual rights theories are examined and found to be ambiguous as to the actual rights they imply. Furthermore, there is no assurance that people will actually be able to exercise any natural rights or agreed-upon rights. People’s actual ability to claim and enforce rights is based on the economic and political power they have, which in turn is based on their ability to provide benefits to others in exchange for others respecting the claimed rights, and in some cases being willing to use force to make others respect them.