Right To Property Is Not A Western Concept

The right to own property is more recognised in western capitalistic democracies than in the rest of the world. The developed West has a much longer history of protecting property rights than the countries of the East.  Does this mean that the concept of private property is western? Obviously not. Private property is a human universal, just as food, sex and sleep are human universals. It may be true that some societies are better at ensuring that the fundamental needs of people are met. This does not mean that the fundamental needs of people vary widely. Some societies are simply better at protecting the fundamental rights of people. The right to own property is the most fundamental of all human rights. In the absence of property rights, all other rights are meaningless.

In India, the right to own a property is not taken very seriously; there is a common assumption that such rights serve the interests of a small minority. This may be unfair. We live in unprecedented prosperity today. We enjoy goods and services our ancestors could not even have imagined. We live many times as long as our ancestors did. There is a huge variance in living standards of people, but these are not privileges enjoyed by a rare minority. Even poor people enjoy goods and services our ancestors did not hear of.

This would not have happened if western societies had not protected the right to own private property to some degree before the onset of the industrial revolution. This would not have happened if other countries did not learn such norms from the West. Japan, Singapore, South Korea, Hong Kong and other prosperous parts of the East might have remained poor without major policy reforms. These norms, however, did not always originate in the West. Some of the fundamental principles of a free market economy originated in ancient China, for example. So, there is nothing intrinsically western about private property rights.

If a low-skilled man born in India migrates to the United States, his income might rise ten or twenty times. This is not because employers in the US are kinder than those in India. This is because the right to private property is more secure in the US. When the right to own a property is more secure, people can engage in trade and productive activities without the fear of being conned or cheated out of their property. When people focus more on production than in protecting their assets, it is easier to accumulate capital. When there is greater capital accumulation, there is greater investment in capital assets like buildings and machinery. When there is greater investment in buildings and machinery, productivity is higher. When productivity is higher, wages are high, because the contribution of an individual worker is greater. This is why a Haitian or an Indian earns far more in the US for doing the same job. They earn more because they produce more.

This is true of all societies. Private property works everywhere. Otherwise, we would not have seen eastern societies that emulated western norms becoming much wealthier in the past few decades. India, for example, alleviated poverty more than any other country in the world over the past decade or so. China brought economic reforms in the late 1970s, and did a much better job. Singapore was poor in the 1960s, but now it is one of the most prosperous countries in the world. This is true of Japan, Hong Kong and South Korea, too. The fundamentals of economics do not change from society to society. It is just that some societies are better at recognising them, and using them for their own good.

The concept of property rights emerged in all parts of the world because property is scarce. Resources are scarce. So, it is impossible to allocate them efficiently without privatising property. When resources are commonly owned, they tend to be wasted. Economist Milton Friedman once said that if we hand over Sahara desert to the government, we would soon see a scarcity of sand. He was joking, but that doesn't mean that he did not have a point. Meghalaya gets more rainfall than almost any other part of the world, but the government has manufactured scarcity of water. That is because the water supply is seen as a function of urban local bodies.

The common argument that western economic principles will not work in India may simply be wrong. If human history is any guide, there is no doubt that the degree to which private property is respected is the degree to which a society has prospered. India's experience in the past 25 years clearly suggests that such arguments are dishonest.

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