The market for protection and the origin of the state

Konrad, Kai A. und Skaperdas, Stergios (2012): The market for protection and the origin of the state. In: Economic Theory, Bd. 50, Nr. 2: S. 417-443

Abstract

We examine a stark setting in which security or protection can be provided by self-governing groups or by for-profit entrepreneurs (kings, kleptocrats, or mafia dons). Though selfgovernance is best for the population, it faces problems of long-term viability. Typically, in providing security the equilibrium market structure involves competing lords, a condition that leads to a tragedy of coercion: all the savings from the provision of collective protection are dissipated and welfare can be as low as, or even lower than, in the absence of the state.

• Dokumententyp: Zeitschriftenartikel
• Publikationsform: Postprint
• Keywords: property rights, anarchy, government
• Fakultät: Volkswirtschaft ; Volkswirtschaft > Lehrstühle > MPI für Steuerrecht und Öffentliche Finanzen
• Themengebiete: 300 Sozialwissenschaften > 320 Politik ; 300 Sozialwissenschaften > 330 Wirtschaft
• ISSN: 0938-2259
• Sprache: Englisch