unless explicitly prohibited. In other systems, like a socialist economy, this is not
the case and property law plays a different role: there, some forms of ownership—
for instance, the ownership of land and of means of production such as factories—
are communal and therefore shared between the people or between a group of
people.
After the fall of the Berlin wall and the removal of the Iron Curtain at the end of the 1980s
and the beginning of the 1990s, former socialist countries had to change their system of
property law from shared or communal ownership to a free market economy based on
freedom of ownership. This change did not only concern movable things, but also land,
which previously also had been held by a community of people. Transition to a free
ownership regime was not always without problems, especially not since most people
were accustomed to sharing objects, in particular land. Sometimes it is held that the
incentive to own individually needed to grow first.Tragedy of the Commons Economic theory also gives us a good indication as to
why there are property rights and therefore also why there is property law. A good
illustration of why it is good to allow ownership of material objects, as a primary
property right, is offered by the “tragedy of the commons.”
The tragedy of the commons concerns an observation of what can go wrong with herders
sharing a common parcel of land, on which they are each entitled to let their sheep graze. It
is in each herder’s interest to put as many sheep as possible onto the land, even if the quality
of the commons is thereby temporarily or permanently damaged as a result of overgrazing.
The herder receives all of the benefits from the sheep he puts onto the land, while the
damage to the commons is shared by the entire group. If all herders make this individually
rational economic decision, the commons will be depleted, or even destroyed, to the
detriment of all.
It is therefore in the interest of all if fewer sheep are put onto the land, and if the land is
assigned to those herders who profit most from it. This can be accomplished by making one
person or group of persons theownerof the land. The owner of the land is by definition the
person who may decide what will happen to the land. If other persons want to use the land,
they need permission from the owner.
The herders can then gain rights from the owner, such as a lease of the entitlement, to
put their sheep onto the land (a grazing right). Those herders who profit the most from the
land will be able and willing to pay the highest price for the grazing right, which means that
the rights will end up with those who profit the most from them. The owner will receive the
money, but since the owner may be a collective, such as the municipality, or a whole set of
herders, this does not have to be detrimental.
Recent examples of the same problematic are overfishing and pollution of the
environment. The creation of fishery rights and pollution rights and of a market to
trade them may have similar advantages to the introduction of private ownership
of land.
5.3 Property Rights in Civil Law and Common Law
There are different kinds of property rights, both on tangibles—e.g., ownership,
title to land and to chattels, mortgage, servitudes—and on intangibles—e.g., what
are called “intellectual property rights” such as copyright, patents, and trademarks.
74 B. Akkermans