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nuisance, and zoning as examples of the law’s attention to particular use conflicts. Alternatively and in a closely related fashion, when problems become serious enough, they may call for a reconfiguration of the property rights themselves; examples would be the more finegrained tradable fishing quotas to deal with overfishing or the unitization of a fragmented oil field under a single operator to prevent overdrilling. But much of the law’s response to use conflict is in a sense implicit: the right to exclude is a sort of “black box” giving the owner decision-making authority over such questions. Thus, an initial approximation of the Blackstonian bundle of rights would include both the right to exclude from a thing and a host of privileges to use it—most of which shelter behind the right to exclude—supplemented by rights and duties of proper use.

• The Thing’s the Thing

In some legal systems, property is called the “Law of Things.” The Latin expression for this is that property rights are in rem, which comes from the word res or thing, and indicates that property rights pertain directly to things, rather than people. A related use of the term in the law of civil procedure—jurisdiction in rem—refers to the power of a court over a thing, such as a ship. One of the more interesting in rem actions is the quiet title action. This allows a person to place some thing under the authority of the court, which will, after providing to all identified claimants the requisite notice and opportunity to be heard, make a definitive adjudication of who owns the thing. Such a judgment is binding on all conceivable claimants, whether or not they have participated in the proceeding. Here we see a direct acknowledgment of the centrality of the thing in the law of property.

It is instructive in this regard to return again to the relationship among contract, tort, and property, but now to draw a distinction between contract, on the one hand, and property and tort, on the other. Contract rights are created by particular agreements between

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particular persons, which create obligations binding on these persons with respect to each other and no one else. (Duties to third parties can arise under third-party beneficiary law, and contracts can often be assigned, but the rules in this area are somewhat special and uncharacteristic of core contract law.) A short-hand expression for this confinement of contract rights and duties to identified interacting parties is that contract rights are in personam: They are personal or are rights with respect to persons. Contract rights do not exist automatically as a matter of law. They are created only when persons engage in certain acts (offer and acceptance, giving consideration) that create obligations specified by the contract and binding only on the parties to the contract.

Property rights, in contrast, bind the world, not just a particular pair of parties. Property in the broadest sense is a set of claims that people have in resources that correspond to duties of respect in others generally. It is this feature of binding the world that is frequently referred to when we speak of property rights as being “in rem.” Because the right attaches to the object, rather than to particular people, it is universally binding on all who encounter the object. Personal rights protected by the law of torts are similar; individual rights of bodily integrity, privacy, and reputation apply automatically to persons as persons (here persons, rather than objects, are the res) and bind all other persons in the world. We could say these personal rights are also in rem, in the sense of “in rem” as “good against the world.”

As we’ve seen, the Blackstonian view places great weight on things in property law, namely the right of some person to exclude all the world from a thing. The bundle of rights picture, in contrast, relegates things to the background, and stresses that property affects the rights of persons with respect to things. One reason for the focus on things and rights to exclude is that property has a distinct audience. When we say that property rights are “good against the world” or “in rem” this means that the flip side of the owner’s right is the duty of the other members of society to keep off, to respect the right, unless the owner has given permission to enter

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or use the thing in question. Property rights are thus like the hub of a wheel with innumerable spokes radiating out from the hub representing the general obligation imposed on all of the many persons standing on the rim.

But what is a thing? A complete answer to this question would take us far afield. For purposes of property law, some examples of things are already furnished by our everyday knowledge. A car is a thing, as is a painting. Identifying other things requires some legal definition, but partly relies also on our prelegal knowledge. A parcel of land like Blackacre requires the drawing of legal boundaries; still, a convention not to jump fences is very easy to communicate to the lay public and depends in part on lay knowledge. Finally, some things are almost wholly legally constructed: Patents require elaborate applications with written descriptions and detailed claims (and often diagrams) because the world does not come precarved into inventions—the things of patent law. Likewise for other intangibles.

We noted earlier that property can be real or personal, tangible or intangible. Nonetheless, not every thing can be property. One implicit limitation on the set of things that are subject to ownership is that they must be things worth managing through the exercise of exclusion rights. Thus, the stars and planets in the heavens are not objects of ownership, because there is currently no technologically feasible way of extracting anything of value from them. A related limitation requires that there be some way of demarcating the resource in question and enforcing exclusion rights in it at a cost that is reasonable in relation to the value of managing the resource. Traditionally the atmosphere and the oceans were said to be ineligible to be objects of ownership, probably because it was too difficult to delimit and enforce ownership shares in these resources, given the gains that might accrue from such an exercise. There are also important moral and cultural limitations on the types of things that can be the objects of ownership. Human beings were once commonly owned as slaves, a form of property now universally regarded as morally repugnant.

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government bureaucracy, allows for decentralization in the management of resources and permits the owner-managers to specialize in developing the knowledge and skills pertinent to their particular resource. The decentralized nature of property also permits experimentation with new uses and techniques for managing resources, rendering it more dynamic than a consensus-based system of local custom. And, so long as the state provides a sufficient degree of security for ownership, the property strategy is more stable and requires fewer expenditures on defensive measures than does a might-makes-right system.

Second, the institution of property provides a powerful set of incentives for persons to make investments in and engage in effective management of the resources they control. A homey way of expressing this is that property allows the owner to “reap where he has sown.”8 Farmers who own land, for example, can decide what kind of seeds to plant, how much effort to put into cultivating them, and when and how to harvest the crops, knowing that the effort and skill they put into the process will be reflected in the yield they ultimately obtain. Other forms of resource management create much less incentive to expend these kinds of efforts to make productive use of resources, because they provide no assurance that those who put in effort to improve the resource will be able to appropriate the fruits of their efforts. This is because no one is in a position to exclude others from interfering with or seeking to capture the benefits of their efforts.

Third, the institution of property facilitates the making of contracts regarding the use and control of resources. In order to contract for the exchange of or modifications to the use of resources, it is necessary to know who controls what resources and, hence, who may make contracts with respect to those resources. Property gives us the answer to these questions. Two types of contracts regarding property are especially important. One is the exchange of property rights.

8. See Int’l News Serv. v. Associated Press, 248 U.S. 215, 239 (1918).

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Suppose I own Blackacre but am too old and tired to make much use of it. If I can enter into a contract to sell it to someone else, then this resource may be used more effectively, making society better off. Another is a contract modifying the use of property. If my neighbor is using his or her property in a way that causes me discomfort or irritation, one solution is to enter into a contract with the neighbor in which the neighbor promises to desist from this use.

Fourth, property is an important source of individual autonomy. Property provides the material means for individuals to achieve a degree of independence from others. By giving individuals control over resources, it allows them to control the direction of their lives. Particular items of property may also be critical to personal identity or to the development of individual personality. Many people’s identity is closely wrapped up with their homes. For others, particular shops or factories may be vital to how they see themselves. Most of us have books, photos, memorabilia, items of clothing, or collections of things to which we attach significance, and which we would be pained to lose.9

Fifth, property is important to the preservation of liberty. Morris Cohen once wrote that property is a form of sovereignty; the right to exclude others from things is a source of power over other people.10 This is true, but it also means that if the ownership of property is distributed widely enough, then property ownership can be a source of countervailing power to the power of the govern- ment—or the power of other property owners. Checks and balances are thought to be vital to preserving liberty, and dispersed property ownership provides an important source of checks and balances. For example, private property allows individuals to organize opposition parties and distribute literature critical of the government; if the

9.See Margaret Jane Radin, Property and Personhood, 34 Stan. L. Rev. 957 (1982).

10.See generally Morris R. Cohen, Property and Sovereignty, 13 Cornell L.Q. 8 (1927).

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government controls all the resources it is easy to squelch dissent.11 And property allows unpopular minorities to resist threats from the government to cut off government-granted benefits or employment.12

Although property has been applauded for these positive functions, certain general concerns have also been raised about the institution of property.

One pervasive problem goes by the name “externalities.” The private property strategy entails dividing the world up into separate parcels of land and discrete objects of personal property, each with its individual owner. But the owner-managers of these individualized units of property may use them in ways that have spillover effects for the owner-managers of other units of property. Spillover effects that have adverse consequences for others, known as negative externalities, are a particular matter of concern. A can use A’s land in a way that generates pollution damaging to his neighbor B. Or C can allow her car to deteriorate into an unsafe condition, posing a danger on the road to D and other drivers. In fact, the very strategy of allowing owners to appropriate the gains from their property creates an incentive to try to foist as many of the costs associated with property as possible onto someone else. Any set of legal rules governing property will thus have to come up with strategies for trying to control negative externalities.

Another concern about property is monopoly. Property, by its very nature, confers a monopoly of control on someone with respect to a particular resource. Every property right is in this sense a monopoly right. Ordinarily, this is of no concern. For example, a farmer can be said to have a monopoly over the farmer’s own land. But if there are thousands of farmers producing a substantially identical commodity—say, wheat—there will be vigorous competition among the farmers in the market for wheat, and the monopoly each farmer has over some particular private production facilities

11.Milton Friedman, Capitalism And Freedom 7–21 (1962).

12.Charles A. Reich, The New Property, 73 Yale L.J. 733, 771–74 (1964).

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will have no effect on the price that consumers must pay for wheat. In other circumstances, however, granting property rights can create monopolies that do have troublesome social consequences. For example, if I own the only piece of land on which it is feasible to build a bridge across a river, this may give me a monopoly on rivercrossings, and with it the power to extract large tolls from the public for the privilege of using the bridge. Similarly, the award of patent rights or copyrights may in certain circumstances allow the owners of these rights to extract very large payments from the public, if there are no good substitutes for the thing they have created. This concern therefore suggests that the property strategy will become problematic insofar as the monopoly rights conferred by property coincide with a distinct market for particular goods or services. It may be necessary in these circumstances to modify property rights by applying antitrust laws or some form of regulation.13

Another concern about property is that it leads to commodification of values and social relations. Property conceives of the world in terms of owners dominating or controlling objects. Many people resist thinking this way about their bodies, their intimate relations, their networks of friends and colleagues, their pets, and so forth. The concern here is with the scope or domain of property rights. The more we extend the sphere of property, the more we think about the world in terms of owner-object relations. Insofar as it is important to preserve a sphere of life that is organized according to different principles, then we must exercise caution about how far the system of property rights extends.

13.Related to monopoly are problems that can arise when too many people have exclusion-like claims on resources. If multiple persons or institutions can veto the use or transfer of a resource, then a kind of gridlock (or “anticommons”) can set in that leaves the resources of society underdeveloped. See Michael Heller, The Gridlock Economy (2008). In some cases, a resource may be subject to more than one property regime (as in a “semicommons”) in order to serve different goals and to benefit from operating on multiple scales—for example, otherwise private parcels subject to a public easement for transit or copyrights subject to fair use. See Henry E. Smith, Semicommon Property Rights and Scattering in the Open Fields, 29 J. Legal Stud. 131 (2000).