The principle of self-ownership means ownership of oneself. But one’s own person is not the only possible object of ownership. To achieve their goals, a person may use many other objects, and this use may conflict with the goals of other people. Claims to preferential and even exclusive use of various things, recognized by other people, form property rights to those things.
Property rights can be recognized for a single person as well as for a group of owners. They can also be subject to various conditions and restrictions. All these complexities are ultimately needed to maintain peace within the community.
Libertarians recognize four legitimate ways of acquiring property. Property rights acquired through these means are usually not contested by libertarians.
1.1.3.1. Primary Appropriation
The first way of acquiring property rights is primary appropriation. It is often called homesteading, named after the Homestead Acts (USA, 19th century) that legalized the primary appropriation of land by American pioneers. Objects that were previously unclaimed are considered, according to libertarian canons, the property of the first claimant if they were brought into direct use by the act of primary appropriation.
This method of acquiring property has two quite obvious limitations. First, inaccuracies are inevitable when establishing the boundaries of the object of primary appropriation. Second, there is no way to unambiguously determine how long property rights should be maintained when the rights to primary appropriation have already been claimed, but the active use of the appropriated asset has not yet begun.
1.1.3.2. Voluntary Transactions
The second way of acquiring property rights is a voluntary transaction. Several property rights holders may, by mutual consent, redistribute their rights in one way or another. Libertarians believe that in a voluntary transaction, each participant gets rid of those property rights they value less at that moment and acquires those property rights they value more—otherwise, they simply would not have agreed to the transaction.
Voluntary transactions can also include unilateral declarations of intent to transfer property, such as inheritance.
The institution of gifts deserves separate mention—they are usually used as a hint of exchange, a prelude to exchange, or an implicit exchange in which the value of what is being exchanged is not explicitly stated but is conditioned by the cultural norms of the community. Thus, exchange as a voluntary redistribution of values may not only not imply the existence of a transaction agreement but may even explicitly reject it—and nonetheless take place.
The transaction as a method of acquiring property also has obvious limitations. A person’s consent to a transaction depends on the evaluations they make, and these can be influenced in one way or another. There is no complete agreement among libertarians on how to treat transactions made through deception or in an altered state of consciousness. Some argue that people have the right to forcibly void fraudulent transactions. Others believe that contracts must be honored, and that the institution of reputation, which we will discuss later, is sufficient to counter fraudsters.
1.1.3.3. Compensation for Damages
The third way of acquiring property rights is compensation for damages. If one subject has caused harm to another, the latter, from the libertarian point of view, has the right to restitution, that is, the recovery of compensation, including by force. This right follows from an extended interpretation of the NAP: no one has the right to initiate violence with impunity not only against a person but also against their property.
This method, however, has a huge number of limitations. Evaluations of damage by the victim, the perpetrator, and third parties may not coincide. It is unclear to what extent counter-damage is permissible during the forced recovery of compensation. It seems clear to everyone that impunity encourages violence, and therefore damage should not be left ignored. Nevertheless, unfair punishment (we will discuss the concept of justice in the next chapter) generates a desire for revenge and only further accelerates the spiral of violence.
1.1.3.4. Production
The fourth way of acquiring property rights is production. If a person applies their own labor to transform any resources that were previously legitimately acquired by them, libertarians usually recognize the person’s right of ownership over what they produce as a result.
Of course, there are pitfalls here as well, the so-called externalities. If one of the results of production is something that causes harm to other people without their consent, do they always have the right to demand compensation for damages? And if the result of production is a benefit to others, and they receive it without any exchange agreement, does the producer have the right to consider such an acquisition of benefit as a loss to themselves and demand compensation for lost profits or at least payment for their labor?