Though property meant originally and essentially the intan gible right to a thing, the word came to be applied also to the object of the right. This is done both in common speech and in judicial decisions, with inevitable ambiguity. This may be readily seen by trying to substitute the word ownership for property, a thing quite simple in some cases but impos sible in others. One would not point to a house and say, "This is my ownership," but either, "This is my property," or "I exercise ownership over it." It is well recognized that a man may have a property right in this abstract sense in or over his own services, as to practise a trade or in the "good will" of a business, or in an intangible patent or a copyright, quite as well as in a material object.
§ 3. Relation of wealth, property, and capital. A fail ure to see this distinction and to keep it clearly in mind has led to confusion, even on the part of legislatures, learned judges, and able economists. If property is said to be (for example) a house and lot and at the same time the right to that house and lot, then there are two properties at once for each economic good, viz.: the object itself and the right to it.' This difficulty could be avoided by the consistent definition and use of terms. A material economic object is a good, is a form of wealth. The usance of wealth and the service of laborers at the moment rendered constitute forms of income. The right of ownership, i. e., the right to control, use, or direct the use of wealth and services, is property, which is therefore the right to receive incomes. The value of the in 2 This confusion has had important practical consequences in the field of taxation. See Vol. 1, pp. 265-267, and above, ch. 18, H 3-5.
come of an individual constitutes his capital. Goods, rights to goods, value of rights to goods: these three things are clearly distinguishable.
§ 4. Some theories of private property. Various theories have been framed to explain the origin and to justify the ex istence of private property. The occupation theory is that property is based upon the priority of claim of one who finds wealth without an owner and appropriates it. This is not an explanation of the property rights that are arising every moment, nor does it give a logical reason for the continuance of ancient property rights. It is a statement applying to a case that has rarely happened, the settlement of an unoccupied territory.
More adequate to explain many cases is the conquest theory, that property is based on force; for nearly all lands to-day are occupied by the descendants of conquering invaders who took the lands and natural resources from the former in habitants, who in turn had taken them from other occupants many centuries before. The conquest theory applies, for ex ample, to the invasion of the Roman provinces by barbarian tribes who divided the country and developed the feudal sys tem based on land tenure. But it hardly applies to present day happenings, and at its best it cannot, to modern minds, "justify" present property rights.
The labor theory, meeting some queries where others fail, is that ownership is based on the act of production. It is declared that every man has a right to that to which his brain and his muscles have imparted value. It is apparent that this test leaves without explanation or justification a great num ber of things that do exist and have existed as property. Usually the basis of the labor theory of property is declared to be each individual's natural right to the results of his own labor, which claim is assumed to be an ultimate, undebatable, axiomatic fact. However, that type of natural-right doc trine, which makes no appeal to experience and results, is now quite discredited in political science.
Another form of natural-rights theory is that property is necessary for the realization of the dignity of human nature, and every individual has the natural right to self realization. This theory is, in a way, based on an appeal to experience as to the effect of property on human character, and it has the virtue of expressing one of the ideals of modern democracy. Although, in common with various other "natural-rights" theories, it must be deemed too absolute and too individualistic, it contains a far-reaching truth, of which due account must be taken in our social philosophy.
The legal theory is that property exists because the law says it shall. This expresses a truth, but is no more than a truism. The law determines the limits of property, but what determines the limits of the law? What practical or social justification is there for passing and continuing such law? The legal theory does not contain a final explanation.