Property rights are arbitrary, but so too it seems are their enforcement. Suresh Naidu is working on research that suggests loose enforcement of property rights over people—that is, slavery—lead to hihger investments in public works and manufacturing, setting the stage for 20th century economic growth. It will be interesting to see how economic growth diverges after the Civil War between districts with strong property-rights enforcement over those with loose enforcement, though it will certainly be difficult to show that this effect is stronger than regional effects.
The hypothesis suggests that institutions are contextual. I doubt this research will lead a chorus of economists to reject the age-old wisdom that strong property rights enforcement is a pre-requisite for growth, but it does give us an interesting example (perhaps the only one) where weak enforcement leads to higher growth.
It also raises the interesting question of how to apply the principles of euvoluntary exchange to the issue of slavery. There is clear coercion by agency over the commodity, even if both legally-privileged parties to the slave transaction feel the transaction was euvoluntary. Whether or not it’s a euvoluntary transaction, we can all agree that this is a transaction that is morally reprehnsible.
In this case, even a euvoluntary transaction isn’t just.