Re: Abstract forms of property
Sun, 27 Dec 1998 12:20:45 EST

Hal gives several examples of complex forms of property, including radio spectrum, mineral rights to land, and various financial instruments, as challenges to simple notions of property. Indeed, no one should limit their notion of property to a fenced plot of land. One instrumentalist reason to value property is that it provides the foundation for complex allocations of rights. But complex types of property render invalid simple ones no more than complex molecules disprove the existence of elements.

Hal's examples seem to fall into three types: 1) Those in which property rights ought not be allowed (in spectrum); 2) those in which creation of a property right does not contravene on existing property rights (in mineral rights and financial instruments, which merely subdivide existing claims, and in unowned outer space); 3) and those in which the quasi-property right reinforces traditional rights by serving as a proxy for tort claims (in pollution and water rights). I'll comment only on the first.

Hal writes of spectrum:
>People could buy and sell frequencies and use them for their desired
>purposes. Spectrum will go to the highest bidder, making for efficient

Most libertarians to address the issue have embraced the idea of creating property rights in the electromagnetic spectrum. Coase, probably the first person address the idea, thought it silly because he reasoned that one can own a natural phenomena. Coase suggested instead creating rights to own and use broadcasting equipment. I think both camps err, though either approach would do better than the FCC's current licensing program. As Hal writes:

>Today, we mostly handle this by government regulation. This means that
>frequencies tend to go to those with political pull rather than to the
>most beneficial uses. A market would be a superior approach.

Both the libertarians stock solution to spectrum allocation and Coase's preferred approach contravene existing property rights. Suppose, for example, that I own a large ranch and wish to broadcast signals on my property, from my house to the far-flung corners of my property. Suppose furthermore that my private broadcasts will not reach off my land. Why should I have to seek permission from someone who allegedly "owns" the spectrum on my land? Why should I have to get a license from Coase's Broadcast Equipment Commission? As long as my peaceable use of spectrum does not interfere with any neighbor's use, I should be allowed to broadcast as I see fit. The example is not specious simply because so few of us own ranches. Low-power broadcasting devices fill our homes--consider garage door openers or cordless phones.

I prefer an analog to trademark law rather than to property law. Loose talk to the contrary notwithstanding, a trademark is not a property right. A trademark holder has only the right to prevent other uses that would create a likelihood of consumer confusion. On your own property and in private, however, you can happily mutilate another's trademark or display confusing variations thereof. Hence the analog to spectrum: Rights to spectrum should reach only so far as preventing interference. If I want to prevent all outside electromagnetic signals from crossing the border of my property, who is to stop me? No one--so long as I do not prevent my neighbors from getting the communications they seek. So long as I want to broadcast on my property, who do I harm? No one--so long as I do interfere with my neighbor's use of spectrum.

T.0. Morrow