Thursday, November 28, 2013

Private Property Saved the Pilgrims

In honor of the holiday, it's time to dust off the argument that private property saved the pilgrims. Benjamin Powell, an economist at Suffolk, tells the story here:

Many people believe that after suffering through a severe winter, the Pilgrims’ food shortages were resolved the following spring when the Native Americans taught them to plant corn and a Thanksgiving celebration resulted. In fact, the pilgrims continued to face chronic food shortages for three years until the harvest of 1623. Bad weather or lack of farming knowledge did not cause the pilgrims’ shortages. Bad economic incentives did.

In 1620 Plymouth Plantation was founded with a system of communal property rights. Food and supplies were held in common and then distributed based on equality and need as determined by Plantation officials. People received the same rations whether or not they contributed to producing the food, and residents were forbidden from producing their own food. . . . Because of the poor incentives, little food was produced.

Faced with potential starvation in the spring of 1623, the colony decided to implement a new economic system. Every family was assigned a private parcel of land. They could then keep all they grew for themselves, but now they alone were responsible for feeding themselves. This change, [the Pilgrims recorded], had very good success, for it made all hands very industrious, so as much more corn was planted than otherwise would have been. Giving people economic incentives changed their behavior.  Once the Plymouth Plantation abandoned their communal economic system and adopted one with greater individual property rights, they never again faced the starvation and food shortages of the first three years.

Of course, non of this explains how the Indians managed to survive here for thousands and thousands of years.

Again, happy turkey day.

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Private property in that which the individual produces is completely different from private property in land, and when we conflate the two, we get in trouble.

(We also got in trouble when we found private property in men -- the ownership of other human beings -- acceptable. And that despite the fact that it seemed to be commonly accepted in the Bible (slaves, obey your masters!) -- but that's another topic.)

We all need access land, and without it are lost. But access to and secure possession of land are one thing, and ownership and particularly the privilege of receiving and keeping its entire rental value are something else completely.

Henry George pointed out the difference very eloquently and clearly in "Progress and Poverty." Within that book, available online, you might look for the passage about the Savannah.

Posted by: Wyn Achenbaum | Nov 29, 2013 9:52:44 AM

In Property in Land, Bob Ellickson pointed out that early settlers often adopted communal modes of production. He suggested that it was a strategy to deal with risk. Once risks are reduced by acquaintance with the new environment, they can adopt more conventional modes of production, including private property. So it could be that the story of starvation followed by prosperity is not simply a parable about private property. In an unknown environment, perhaps neither private nor communal property would have been all that productive, and communal was chosen in order to reduce the risk of starvation. Once that risk was reduced by acquaintance with the new environment, private property could be re-established in order to increase production.

Posted by: bill fischel | Dec 4, 2013 12:34:13 PM

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