Economics Department

Jim Klein - Research in progress

Data and Theory

In 1960 Ronald Coase suggested economists treat factors of production as rights, rather than things.

This led to the Law and Economics revolution in economic theory.

Rather than assuming property rights are well defined, the task for economic theory is to derive the existence of factors of production and delineate the exogenous factors that determine the costs and benefits of enforcing the right to a factor of production.

At the present time, economists throughout the profession are building models to address this issue.

I'm building one myself.

To test these theories economists will need a database.

I'm also building a database to test these theories.

Theoretical work

In 1980 James Buchanan suggested tax revenue maximization as the basic assumption for government activity. At that time, I had a similar model.

In 2005 I suggested to Buchanan that a tax maximizing government would establish and maintain property rights. He confirmed my thinking and suggested it was a novel thought in the field.

Since then I've been working on a theoretical model to derive the existence of property rights and the Theorem of Exchange.

Read more...

Indies Project

To test the theories that have developed since Coase's work in 1960 economists will need a database, showing how rights are established and maintained.

For four hundred years, European sailing ships explored the world, bringing with them their own regulations, laws, and business practices.

For the same time period, the technology and trade goods were constant. A sailor from 1450 could step aboard the most modern warship of 1850 and feel at home. Similarly, a trader from the early period could walk into a market in 1850 and know what to buy and ship back to Europe.

In the West Indies - including all of the Americas - Europe imposed their system on a population too small and primitive to stop domination. Here we find a clear example of the differences between the government styles of Portugal, Spain, France, the Netherlands, and Britain.

In the East Indies the opposite is true. Here a massive population of indigenous people were exposed to the forms of European government and trade.

As with the West Indies, these government styles led to different levels of economic activity.

The Indies Project will detail European activity to enforce human and property rights in the age of sail and the associated economic affects.

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