Empire

Mason Gaffney:  Rent Seeking and Global Conflict

National governments originate historically to acquire, hold and police land. Other functions are assumed later, but sovereignty over land is always the first business. Private parties hold land from the sovereign: every chain of title goes back to a grantor who originally seized the land. ...

We would be more useful to statesmen if we looked first at rent-seeking in the grosser sense of “land-grabbing,” where the whole bundle is at stake. When William of Normandy conquered England the prize was land rent, all of it. He and his retainers dispossessed the local rent-collectors. It was simple, gross, and basic, and much more consequential than the trivial rent-seeking we model today. The bulk of the natives may have been affected only marginally: they just paid Lord B instead of Lord A. But it made all the difference to Lords B and A, the ones who made basic decisions about global conflict and cooperation. ...

But the site never was nor could be the product of capital formation. It pre-existed man, who could only acquire it by taking. It is fair to say that throughout most of history that is what warfare was about, seizing and holding and policing land. This is not to deny ancillary causes and issues of war, such as disputing the pathway to Heaven, ethnic pride, paranoia, acquisitive genes, and a leader's need to divert people from domestic problems. Economists should certainly make it their business to address the last, a major source of global conflict. Neither is this to deny that territorial expansion is often self-defeating, economically. Many empires, probably most, cost more than they return, a discovery that accounts for the well-being of small nations like Sweden, Austria, Denmark and The Netherlands, which gained by abandoning destiny and empire. But we would miss the point to bury particulars in aggregates. By disaggregating benefits and costs we gain the key to understanding. The whole nation loses, but certain parties gain, and it is they who promote and sustain aggressive behavior.

Economists conventionally bury this point when they submit that "national defense is a public good".