The Market for Protection and the Origin of the State

Kai Konrad and Stergios Skaperdas

No 1578, CESifo Working Paper Series from CESifo

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 self-governance 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.

Keywords: property rights; anarchy; government (search for similar items in EconPapers)
JEL-codes: D30 D70 H10 (search for similar items in EconPapers)
Date: 2005
New Economics Papers: this item is included in nep-pbe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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Related works:
Journal Article: The market for protection and the origin of the state (2012)
Working Paper: The market for protection and the origin of the state (2012)
Working Paper: The Market for Protection and the Origin of the State (1999)
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