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Legal positivism and property rights: a critique of Hayek and Peczenik


Scholars such as Friedrich Hayek and Aleksander Peczenik have criticized legal positivism for undermining constitutionalism and the rule of law, an implication of which is weakened private property rights. This conclusion is far from evident. First, I contend that legal positivism is compatible with a strong support for property rights. Second, the causal relationship between legal positivism and the degree to which property rights are applied and protected is analyzed. The main arguments for a negative relationship—that legal positivism centralizes and politicizes legislation and that it makes the legal culture servile in relation to the political sphere—are considered unconvincing.

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  1. The effects of legal positivism on property rights are the focus of the analysis, in accordance with Mises (1949, p. 678) who states that “[p]rivate ownership ... is the fundamental institution of the market economy,” although the analysis can be readily applied to effects on the market economy more broadly. On the institutional basis of the market economy, see Vanberg (1999).

  2. For philosophical critiques of legal positivism, see Fuller (1964), Dworkin (1977, 1986) and Finnis (1980).

  3. For an analysis of such effects of a related idea, ethical subjectivism, see Berggren (2004).

  4. Cf. Soper (1995, p. 425) and Kramer (1999, p. 2). The version of legal positivism that is discussed here is the inclusive one—see Waluchow (1994) and Kramer (1999). The exclusive version, primarily represented by Raz (1979, 1986), claims that it is not, like the inclusivists think, sufficient to say that there is no necessary connection between laws and morality but denies that there can be any such connection. The exclusivists regard these phenomena as separate, not only, like the inclusivists, as separable. See Marmor (2002).

  5. See Kelsen (1967, p. 13). Cf. Hayek (1960, pp. 237–239).

  6. See Hart (1958). On Kelsen’s view, see Stewart (1990).

  7. See Green (2003).

  8. Weak private property rights, as well as collective property rights, are of course also compatible with legal positivism.

  9. See Bix (2002) for more on modern natural law theory.

  10. As remarked by Hartmut Kliemt in private conversation, the issue is really one of psychology: people could be induced by a formal idea to hold certain content ideas even though the formal idea as such really does not indicate any particular content ideas. This could come about through misunderstandings of the formal idea or through irrationally. But it is hard to find fault with a particular formal idea because the human brain sometimes works in certain mysterious ways.

  11. Cf. Peczenik (2002) for a critique of relatively unconstrained majority rule and for an argument in favor of a strong influence for courts and legal scholars based on their perceived rationality and coherence.

  12. For a detailed argument, see Hayek (1973, chs. 4–6).

  13. See Marmor (1998).

  14. For a critique of this way of interpreting the actions of judges, see Posner (2003, pp. 80–81, 268–269).

  15. See Kramer (1999, pp. 114–115, 152, 197–199). Hayek (1976, p. 56) admits as much!

  16. Buchanan and Tullock’s (1962, pp. 77–80) research in constitutional economics bears resemblance to this approach. Cf. Buchanan (1974, pp. 335–336) and Brennan and Buchanan (1985).

  17. Kelsen (1967, p. 152).

  18. More critics: Buchanan (1977), Okruch (2000, 2001) and Schubert (2004). For a discussion, see Barry (1982, pp. 31–33). Hayek (1973, pp. 88–89) himself acknowledges that the common law may stand in need of correction by legislation from time to time but offers so systematic account of when this is to be carried out.

  19. Gwartney and Lawson (2004) measure the degree of economic freedom in 123 countries from 1970 and onwards by means of an index which includes the quality of the legal system and how secure property rights are. It e.g. makes clear that property rights are relatively strong in Sweden, a country characterized by legal positivism, and that they have become stronger in recent decades, in spite of reliance on centralized, politicized legislation.

  20. As pointed out by Hartmut Kliemt in private conversation, this insight puts the focus on the normative arguments in favor of particular rules of recognition, arguments that are not merely conceptual.

  21. Hayek (1960, 1979, ch. 17) himself presented a constitutional proposal which implies that he thought it possible to reduce the problems with centralized, politicized legislation. This insight is, however, rarely present in his critique of legal positivism (or democracy). Rapaczynski (2004) claims that if constitutional rules have an effect in upholding strong property rights, this occurs through procedural rather than through substantive rules.

  22. See Buchanan and Congleton (1997). The generality that Hayek regarded as characteristic of the common law can also be introduced as a constitutional rule in a centralized legal order.

  23. Okruch (2000) claims that in the civil law tradition there is also a strong element of following precedents in adjudication, and so he thinks Hayek’s distinction between the systems too strong.

  24. He also held that a constitution could contain substantive norms such as freedom of expression and religion—see Kelsen (1986).

  25. Cf. Posner (2003, p. 261).

  26. There was a debate on this topic between Radbruch and Hart: see Hart (1983, pp. 72–78).

  27. Carlsson (2001, pp. 72–73) questions whether the fact that many high judges in Sweden have a background as minstry officials has all that much to do with leading Swedish legal positivist Axel Hägerström, as is often claimed. Rather, the tradition goes back much longer.

  28. Hart (1961, ch. 7) e.g. stresses the open texture of the legal language which gives judges room to actually create laws in concrete cases. This room can, if the rule of recognition admits it, legitimately be characterized by ethical considerations and, of course, the rationality of legal argumentation (see Peczenik, 1989).

  29. This appears to be the case in e.g. Sweden: see Maccormick and Summers (1991).

  30. Natural law can be seen as both a formal idea and a set of content ideas.

  31. In addition, legal positivism is compatible med moral realism, and people can find the proposition ”the law should contain strong property rights” objectively true, regardless of whether they accept natural law.

  32. It is a negative thing if the change occurs as a result of a misunderstanding of legal positivism—for instance, that it implies socialism solely because some legal positivists have been socialists.

  33. Cf. Kuran (1995) and his theory of preference falsification.


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The author is especially grateful for comments from Hartmut Kliemt but also for comments from Andreas Bergh, Anders Fogelklou, Alan Hamlin, Rolf Henriksson, Dan Johansson, Henrik Jordahl, Nils Karlson, the late Aleksander Peczenik, an anonymous referee and participants at the Public Choice Meetings in New Orleans 2006, as well as for financial support from the Torsten and Ragnar Söderberg Foundations and the Marcus and Amalia Wallenberg Memorial Fund Foundation.

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Correspondence to Niclas Berggren.

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Berggren, N. Legal positivism and property rights: a critique of Hayek and Peczenik. Constit Polit Econ 17, 217–235 (2006).

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  • Legal positivism
  • Property rights
  • Constitutionalism
  • Hayek
  • Hart

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  • O17
  • P14
  • P48