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The Demsetz Thesis And The Evolution Of Property Rights, Thomas W. Merrill

Faculty Scholarship

Both conventional price theory and standard economic accounts of tort and contract law assume fixed property rights. In fact, however, property regimes are not static but change over time. Given the assumption of fixed property that otherwise prevails in economic literature, explaining the evolution of property rights is one of the great challenges for the economic analysis of law.

The point of departure for virtually all efforts to explain changes in property rights is Harold Demsetz’s path‐breaking article, “Toward a Theory of Property Rights.” The article is still widely cited and reproduced, especially in first‐year property courses in law schools. …