Revelation from Web3: The Economic Significance of Violent Power

“There is no property, there is no domination, there is no distinction between mine and yours; what every man can have is his, if he can keep it.” – Thomas Hobbes

This is an essay by Professor Frederic C. Lane published in the Journal of Economic History in 1958, and is also a reference article in the web3er’s must-read bible **The Sovereign Individual**. The main topic of discussion is to analyze how business organizations control and influence the economy through violent monopoly from a dual perspective of economics and history.

Interference in economic production through violent monopoly does not sound like the mainstream of economic thought in the 21st century, but a fact that cannot be ignored is that it is precisely the US military power that maintains the global hegemony of the US dollar. Overseas military bases distributed in global maritime trade routes realize hegemonic monopoly from military to financial.

The current global economic system not only has obvious problems, but also exacerbates the occurrence of economic inequality. For example, the economic crisis in the United States can make all countries in the world take risks by printing money indefinitely. This is an extremely unfair economy. Activity is also the embodiment of “violent monopoly” in the modern economy.

Violent monopoly, as a final and exclusive manifestation of power, can theoretically monopolize all activities in society, thereby forming complete control over productive activities. However, in the ideology of global universal values ​​of “freedom, democracy, and equality” In China, a free and fair economic market seems to be the main theme of economic development. People are deceived by appearances, but the fact is that the ghosts of “violent monopoly” that have been turned into capital early are everywhere.

In the modern economic system, the power of capital penetrates into all aspects of life, and the monopoly behavior in the capital market, whether it is a legal monopoly through the law or a technological monopoly through the Internet, can be said to be “violent monopoly” Continue to control the results of the market economy and the distribution of benefits with a business moral behavior that conforms to the modern economic order.

Assange made a declaration to the world in his book “Cypherpunk”: “To be free from all powers and any form of violence, the rights of the individual are surrendered.”

We are on the eve of a millennium of change. Most of my friends know that the core of web3 is to return property rights to individuals, but they don’t realize what kind of social changes this will cause.

Human beings are on the eve of entering the era of digital civilization, and digital space will also become a new habitat for human beings. The technological revolution of Crypto&Web3, represented by encryption technology, is trying to reshape a digital society and reshape the laws of operation at the bottom of society. .

From the protection of personal wealth in the spirit of encryption, the distrust of all intermediaries, and the defense of personal wealth in one’s own hands, to the technological paradigm and ideological enlightenment of the Web3 personal property rights return movement, it is a further and thorough mastery of one’s own means of production and The idea of ​​self-control over production relations and freedom from all “monopoly of violent power” is gradually brewing in the 21st century.

Just like the Reformation movement during the Enlightenment, in order to eliminate the church’s monopoly of belief over the people, and to eliminate all moral standards that emphasized external forms, God re-established an inner relationship with individuals and returned to the purity and sincerity of faith.

And in our current economic environment, monopolistic “agents” are everywhere. The state is the only organization that has a legal monopoly on violence so far, and in a certain period of history in the past, the taxation behavior of a government was no different from the violent extortion and extortion of the underworld. However, the advantage of the state is that in a turbulent war environment, it can deter the use of violence by other organizations by using stronger means of violence, and by restraining violence, it can create relevant laws to maintain the order of social development.

And as people can work from anywhere in the world, when our income is determined by individual capabilities and market forces, our digital assets no longer need government protection, interference, or regulation, and governments will not be able to reasonably charge more than the value they provide This also shows that the logic of the world, which was originally dominated by violence, will change, society will change accordingly, and the coexistence of multiple forms of sovereignty will also be the norm.

Throughout human history, people have been disciplined from top to bottom by the central idea of ​​centralization for thousands of years, which has long been deeply embedded in people’s genetic memory. People habitually don’t want to overthrow the existing accepted system, and don’t want to leave the safe zone established by the laws and values ​​on which they live.

And this time, can the individual break away from the limitations of the region and environment, get rid of the fate of being dominated by others, successfully complete the awakening of personal consciousness, and truly grasp the sovereignty in his own hands? This will be a bottom-up, social organization change based on the idea of ​​individual sovereignty, which will change the way people live and protect themselves, and reshape the entire society.

Not to mention other moral demands, at least in the global economic system where free capital monopolizes the economic market, we hope to reproduce the establishment of a more economically equal global market system, a society of freedom, democracy and equal opportunities, and the idea of ​​individual sovereignty, would be our ideological weapon against the old order.

Undercurrents are surging in the world today. Three years after the global epidemic, black swans frequently flutter their wings and take off. Perhaps, this period recorded in history in the future may be the beginning of troubled times and the beginning of enlightenment revolution.

If you are unwilling to live in the domesticated iron cage of the system, unwilling to see the world sinking and capital alienation, and hope to live without regrets and regrets with ideals in your heart;

Well, Web3 welcomes you and looks forward to your joining us

Please contact the translator: tea light lightness.eth

author of this article

Frederic C. Lane (1900—1984), American historian, graduated from Harvard University, taught at the University of Minnesota, Johns Hopkins University, and served as the Italian Society for Historical Research Chairman, President of the American Historical Society, President of the Economic History Society, President of the International Economic History Society, editor of the Journal of Economic History, academician of the American Academy of Arts and Sciences, and a member of the American Society of Medieval History, and won the 1980 International Galileo Prize.


tea light lightness.eth (lead author)



There is a trend in the writing of current economic history: articles are more focused on material goods and numbers of people. But this is not because economists seriously believe that the main purpose of human existence is to produce more people and to give each member the most material resources at their disposal.

I don’t think economists or economic historians hold such a materialistic belief – why else would they choose to be professors?

And the reason we are more easily misunderstood is that the two major political powers today, the United States and the Soviet Union, use different ideologies, and yet, paradoxically, both extol its material values ​​as a testament to the strength and effectiveness of its ideals sex.

A major concern in past economic history, from Adam Smith and Karl Marx to Gustav Schmoller and Richard Toney, has been to dissect the forms of justice and injustice in economic life. They are usually expressed through indignation and sarcasm. Because as historians, they mostly write about injustice, trying to achieve a more perfect justice by finding alternatives.

I hope we don’t stop searching for justice.

I put this statement of faith in the beginning because the way I write can lead to misunderstandings on the subject.

In this article I wish to explore whether it is possible to discuss government as one of many organizations producing goods and services , and in particular as a type of what I call a “Producer of Protection Services”.

I will set aside any consideration of justice, focus on material possessions, and perhaps even speak ruthlessly about the power of violence.

Chapter One

Economic theory has discussed in detail some of the functions performed by the state, such as monetary policy, but relatively little has been done on military and judicial activities, which have been historically far-reaching and can be seen as the essence of government.

One of the tasks of economic history is to overcome this exclusion from the analysis of the use of violence that economic theorists often write about.

Looking back over the centuries, even now, we can clearly observe that many people rely on the use of violent weapons to make a living, and their actions also play a key role in “how to use scarce resources”.

People specializing in warfare appeared very early in the history of the division of labor, and were organized very early on as large-scale commercial organizations (note: this article refers to commercial organizations with monopolies that use violence).

From a political and economic basis: the use of violence, the control of violence in the industry is a natural monopoly, at least in the land. On a geographic scale, services can be provided at a lower cost through monopoly.

Of course, there have been cases of violent business groups competing for protection money in the same territory, such as during Germany’s Thirty Years’ War, but this is less economical than competing telephone systems in the same area , competing police forces are even less efficient than competing fire brigades.

I maintain that, at least in some cases, the use of violence should be considered a productive activity and that governments must be seen as producers of a portion of total economic output , even if they have no other function than the use and control of violence.

To be sure, armed robbers do not provide any service through robbery; but it is widely believed that the police who protect us from robbers, and the courts that protect civil rights, even the courts against the police, do provide a Serve. A further problem here arises when we find that the extortionist charges a “protection fee” against the violence he is subjected to, in effect offering a “black market” protection in return for a repression of the hostile gang purpose.

Such edge cases may not be important when analyzing economic life in modern America, but they cannot be ignored when we consider the organization of business activities that used and controlled violence in Europe during the millennium from 700 to 1700 AD.

Which aristocratic rulers with fiefs provided police services?

Who are blackmailers, or even predators?

**Once a looter legalizes what he has “acquired”, then he can become a police chief, ** and can adjust according to his ability to pay, protect his territory from other looters, and put His territorial monopoly lasted long enough until people got used to seeing his actions as legitimized.

Whether a government is engaged in pure policing and defensive warfare, or is using violence against people who refuse to pay, is important to look at from several different angles, some of which I will discuss later question.

In fact most governments are probably a mix. But in any case, from the perspective of the paying company, the payment to these governments is the price they have to pay to avoid more serious losses.

The protection that people get is far from perfect; the business event organisations that provide “protection” offer poor service and ridiculously high prices, and as bad as it is, it’s still a must for most companies Paid services, without protection, they cannot function. While this is wasteful at ideal standard costs, protection fees are one of the various wastes that exist in society.

When examining how the nature of monopoly controls the costs and revenues of organizations that influence violent commercial activities, a clear distinction emerges between organizations that provide protection fees for protection services and organizations that provide no services.

Once it has eliminated all competing violent connoisseurs in the territory it monopolizes, it can reduce the cost of policing the territory, the cost of protection of production and sales, and thus the remuneration of farmers, artisans and local merchants , unless there is a dangerous threat from outside.

If the government’s means of gaining legitimacy were only through prolonged monopolies and customs, or rituals and religious practices, and appeals of opinion of any kind, it would be a cheaper way to control violence than police force spending, so the costs could go further reduce.

But a reduction in the cost of organizing production “protected” business activities does not necessarily lead to a reduction in exorbitant taxes.

As a monopoly business activity organization, it can maintain its “selling price”, or it can increase its price to the point where it encounters a sales resistance, namely the difficulty of taxation, which is equivalent to disguised invitation of its competitors to enter the monopoly area .

While reducing costs, increasing taxes, or a combination of the two, ensures that at the highest price people can afford, the business activities that produce “protected” organizations continue to earn more than their costs and generate a surplus. This is a special kind of monopoly profit (or producer surplus) that I’ll call a tax for convenience .

Of course, if the business organization that controls violence behaves according to our democratic ideal of government, it will not collect taxes. Because it can reduce costs and reduce protection fees at the fastest speed.

If a government is actually controlled by its consumers, it can be expected to do as envisioned in the theory of representative government. But for most of history, government was not democratic ; the organization of business activities that produced “protection” was not jointly controlled by other producers and consumers. Insofar as they rationalize the economics of the organization of commercial activities that control violence, they are not pursuing the goal of serving consumers by maximizing the quality of service and minimizing the prices charged.

Many organizations of commercial activity that produce “protection” are controlled by the upper echelons of the military and police, in short, by their top management. In this case, their primary goal is to protect the safety and survival of the business activity organization, and maximizing scale is more important than maximizing profit.

The management methods of the military and hired grass-roots personnel are different from those of modern unions, at least not violating policy regulations, and should be degraded as little as possible.

When grassroots employees are managed as a group, they have no interest in minimising protection fees, much less minimising their own wages that account for most of the labor costs. It’s more to their tastes to scale up as much as possible.

And in those governments controlled by nobles or emperors, absolute rulers, a different law prevails. Those in power can be considered as owners of commercial activity organizations that produce “protection”, and they pursue profit maximization while maintaining prices. while trying to reduce costs.

Like Henry VII of England or Louis XI of France, use as little tricks as possible to secure his orthodoxy, maintain domestic order, and distract neighboring nobles in order to lower his own. military spending.

In modern times, discussions of fiscal policy are full of implications for full employment and correcting social inequalities. So in the modern context, it may come as a shock to see the government as a for-profit enterprise .

But under feudalism, the fief-holder expected to manage his fief for profit. A successful baron may disdain bourgeois haggling over commodities, but he must be adept at using military and government means to make money.

The concept of this hybrid public-private partnership was formed during the continuation from feudalism to the establishment of absolutist states at the end of the Middle Ages. Moreover, at that time, because the government was so insecure, and the limits of its territorial monopoly were so uncertain, that the aristocrats, who were the heads of organizations that produced “protected” commercial activities, faced competition with each other.

They tend to act on the principle of maximizing profits unless a competitor takes their resources and customers from them.

But as Louis IX had done, the nobles, after overcoming this difficulty, continued to pursue profit, and also organized a bureaucracy dedicated to this goal.

Government business activity organizations and other types of business activity organizations differ considerably in the degree and principles of rationalization, but as the public interest influences, and more and more other types of business activity organizations become monopolistic For business event organizations, this difference is gradually narrowing.

However, in the European governments of the feudal period, the king regarded their territory as personal property, and in the process of competing for the colonial empire, the king and the chartered company were mixed with violence in the trade process.

When an organization of business activities producing “protection” is profitable, the profits or taxes generally go not to just one person, but to an aristocratic-centric group that distributes gifts, pensions, bonuses, and important positions.

If a king had to spend all his income on the army and the police, he would have no profit, no taxes to keep or give away, because all his income was spent on the cost of governing the cause.

In fact, in the early modern period, nobles bought military services from suppliers, and military entrepreneurs who recruited, organized, financed, and commanded soldiers all made huge profits.

Officials in the judiciary and finance departments, as well as the military, have used government power for private gain from suppliers. Due to the lack of an effective bureaucratic system, the royal business activities organization outsourced a large number of violent activities, so that the subcontractors made huge profits by maintaining the government’s behavior of levying sky-high taxes and miscellaneous taxes. It can be said that the subcontractors are the main stakeholders of the tax.

Moreover, the courts of the Renaissance nobles had many favored courtiers, who received gifts and pensions far exceeding the sums that would induce them to engage in any protection-related service.

One might wonder: If the government’s taxation remains the same, but the violent fiscal expenditure is reduced, what will be the impact on other productive relations in society? The answer is yes.

The high cost of producing protection consumes a lot of resources, and high protection fees only transfer wealth from one group to another.

A reduction in the cost of production protection, whether or not prices are lower, frees up resources for other uses. If the cost of production falls without falling prices, the resulting profits or taxes can be spent on new consumption, or hoarded or invested. This is the difference between taxes and the labor production costs incurred by other government employees such as soldiers, police officers, tax collectors, and legal officials.

I suppose, as a practical matter, this distinction is hardly applicable to any statistical analysis of royal spending, but there was enough conspicuous consumption in Renaissance courts to suggest that some of the revenue collected and given out in the king’s name was useless For necessities, not even for military necessities.

When taxes are used to satisfy luxuries or curiosity, it stimulates new demand and production. If not spent on this consumption, the tax money can be used for investment, for example, for the courtier to improve his land property.

Chapter two

In addition to governments, business organizations that are primarily concerned with producing goods and services rather than protecting them have also found opportunities for profit from the use of violence. These opportunities are created by the government, mainly through the fact that the business activities that control violence charge different prices for different categories of customers, and in layman’s terms, through the government to charge different fees to different businesses.

An important reason for this is that, in the late Middle Ages, due to the influence of Ricardo’s analysis, ground rent was gradually distinguished from seigniorage and protection fees in taxation. I do not have time to discuss this, because I want to explore another important aspect, namely the nature and sources of profits in international trade .

The profit margins of businessmen who do business by running long distances are easily suppressed by other competing businessmen. If one merchant is as good as another at gathering information and guessing supply and demand, the merchant who can operate at a lower cost will reap greater profits.

A large part of their cost is the protection and insurance premiums that they have to pay, and if they do not pay protection fees to the business activities, they may suffer losses due to violence.

Some trading businesses get more protection than others, or the same good protection at a lower cost, and this difference in cost allows them to make extra profits**, which I call protection rent, applicable The total profit on all cost differences arising from the use or control of violence. **

A simple example sheds light on my thinking in a modern context. If two copper producers have the same cost of extracting, refining and transporting the ore, while selling at the price set by the London market, but paying different duties on their way to the market, the one that pays the lower duty will receive protection rent.

During the late Middle Ages and early centuries of European maritime expansion, businesses engaged in international trade or colonization had to pay multiple fees for protection.

These include escort fees, tributes to Barbary pirates, or higher insurance for sailing into pirate-infested waters, bribes to customs officials or higher authorities, and other types of smuggling fees. It also includes some of the expenditures of trade or colonial commerce organizations organizing their own armed forces— from deploying additional guns on individual ships, to sending troops of soldiers to defend, or even conquer a colony.

Businesses receive protection in a variety of ways, which allows them to choose among a variety of ways, pay different amounts depending on the choice, and receive different kinds or degrees of protection in return.

They can transport cargo in heavily armed ships and pay low insurance, or ship in less-defensive ships and pay high insurance.

They can go to a port that has a treaty but pay high tariffs and in return the port can keep them from being seized, or they can go to a port that has no treaty and choose to trust their guns, diplomacy and hefty bribes .

**In the competition between merchants in different regions, who can get the protection fee with lower cost is often the key success factor. **This is generally achieved through a public-private mix.

Venice’s famous merchant fleet was successful partly because of the quality of their ships for the marine environment in which they were found, and partly because they were the best solution to conservation problems for some time – they not only avoided Infested by pirates, and flexible in mobilizing trade flows to ensure swift access to treaties that are most beneficial to them.

To explain why Venice prospered more than its rivals, or in some periods more than others, one must consider how the Venetians maximized their guarantees of safer and cheaper purchases of goods, transportation, and Sold in a good market and protected from violence.

In the Middle Ages and early modern times, conservation rents were a major source of wealth in trade.

In my opinion, they are a superior and more important source of profit than industrial technology or industrial organization. The wealth derived from conservation rents by commercial and colonial commerce organizations gradually increased and even began to rival the wealth the government derived from taxes.

Like landowners, whom I don’t have time to discuss, businessmen also become surplus stakeholders, free to consume luxuries and to invest relatively high amounts.

Their habits, abilities and participation as businessmen make them generally the class most inclined to save and invest in the products of economic surplus (note: the sum of consumer and producer surplus). By surplus I mean that part of the total output that does not have to be consumed in order to maintain the current level of production.

The following three conclusions about the remainder can be drawn from the above analysis of the use of violence:

**First of all, the higher the production cost of the protective production business activity organization, the smaller the surplus. **When organizations of business activities that produce violence are run by employees, they make little or no effort to minimize costs, so a significant portion of the total cost of production is consumed by militarism.

**Secondly, when the production “protected” business activity organization is controlled by the monarch’s autocracy, he will focus on how to reduce costs and achieve increased surplus. After accomplishing its purpose, most of the surplus goes to the monarch’s court for conspicuous consumption or investment.

Third, in international trade and colonial economies, there is a large gap between the protection fees paid by competing enterprises, while the enterprises that pay less fees can obtain protection rents . Protection rents are actually profits in disguise. It is equivalent to reducing the cost that would have been paid.

Since this third situation appears the latest, a staged theory of economic development is proposed, which I take as the prelude to Schumpeter’s “Capitalism, Socialism, and Democracy”.

In the first stage, anarchy and pillage predominate.

Viking raids and feudal warfare nearly plunged the Frankish region into this “primitive anarchy” around AD 900. Violent competition is fierce, even on land.

The second phase begins when small regional or provincial monopolies are established, agricultural production rises with it, and most of the surplus is taken away by the recently established violent monopolies. As in the feudal system of the 12th century, when monopolies formed loosely organized cartels, constantly bickering over their respective production and market quotas, due to the high military costs of the time, less surpluses were left and were widely distributed among tribute class.

In the latter part of the second phase, many tribute classes offered agricultural and commercial deals to attract customers. They offered low-price protection to those who put new land into cultivation, and provided special police services to encourage trade, such as those organized by the counts of Champagne for merchants who came to their markets. When profit-seeking aristocrats consolidated their monopoly positions, they were able to lower production costs and increase the amount of taxes.

In the process, the distinction between land rents and taxes and seigniorage became more pronounced, and there was a larger surplus, which, although mainly in taxes, made consumption more diversified, which in turn stimulated trade between the regions. Competing traders differ in how they pay protection fees, resulting in protection rents.

The third stage is reached when the merchants who collect protection fees and the landowners who collect rent receive more economic profits than fiefdoms and monarchs.

In the third stage, protection fees and ground rent replaced taxes as the main source of large income. Since successful merchants spent most of their income on capital accumulation, a higher percentage of the surplus was invested in expanding commercial enterprises, agricultural improvements, and new industries.

The transition from Stage 3 to Stage 4 occurred when technological progress and industrial innovation became a more important source of business profit than protection of rents, and violent business activity organizations became more and more respectful of the needs of customers; and the government became more democratic.

In the past, the formation of credit—the formation of deposits, the issuance of bonds, and the overall mechanism of capital markets—was largely in the service of protecting production companies, and now it is in order to meet the needs of industrial innovators.

We have reached the capitalist stage of the Schumpeterian model, my prologue ends, and the new main show begins.

I’ll admit, I’ve broken down a thousand years of history into four phases, which contain some irony. There is no sequence of stages that enables us to predict the future or explain specific events in the past, stages are abstract models. Stage theory is just a means of emphasizing certain factors among many.

**The difference between the four stages is the changing relationship between the organization of business activities that use violence and the amount and distribution of surplus. **They are mainly concerned with the distribution of surplus among different production organizations, because the distribution of surplus affects the relevant organizations that use violence, whether in the form of consumption or in the improvement of other industries.

The total amount of surplus, and the multiple uses of surplus, are critical to economic growth.

Economic growth that accompanies industrialization has been so fruitfully studied for nearly two centuries that many modern concerns have been brought back to ancient and medieval studies with exciting results.

But from a longer-term perspective, I think in most periods of growth, one of the most important factors in growth is the reduction in the proportion of resources devoted to war and police.

For many centuries, the primary way that governments influenced growth was through decisions about how much money should be spent on the use and control of violence.

Aristocrats or politicians who ran government in a way that lowered the cost of conservation contributed to economic growth just as much as industrial or agricultural reformers who lowered the cost of other products. And the nobles are more important because they are not reducing the cost of a luxury that is only a small part of total consumption, but are reducing the cost of a widely consumed necessities.

However, the influence of monarchs on economic growth was not negligible, they cut costs while maintaining or raising their exorbitant taxes, taking most of the surplus available for capital accumulation in the name of taxation. If all tax dollars were spent on conspicuous consumption (a term that seems to be especially appropriate for the court of the nobility under the old regime), growth would be slowed by underinvestment.

Merchants who received protection rents from international trade and colonization, while their consumption was not entirely inconspicuous, had a lower propensity to consume. As a result, lower profits for governments and higher profits for trading firms means more capital accumulation and more growth.

I use the means of stage theory to emphasize the relationship between the organization of commercial activities using violence and the distribution of surplus, and the monopoly is the basic condition of this relationship. In addition, there are other aspects that deserve more attention.

In my fourth stage, roughly equivalent to the accepted model of industrial capitalism. Monopoly occurs in temporary form due to technological and commercial innovation, and in those industries that have reached a certain stage of technological development, monopoly is relatively permanent.

In the early stages, few industries have undergone such technological development to become natural monopolies, but governments did, and I tend to call governments the earliest natural monopolies .

As another basic service industry, priestly activities were widely organized on a considerable scale in the early days, and the water industry was even a larger natural monopoly in some areas. Except for special areas related to natural resource utilization, monopoly is most useful for priests and governments, two closely related service-providing organizations.

Monopoly in one area can be used to seek monopoly in other areas; it’s like control over basic ingredients can give rise to control over finished products. Since protection is in a sense an essential component of almost all other products, the government can use its monopoly in its own field to establish a monopoly over other products.

When water conservancy, government, and religion were combined into one huge centrally directed enterprise, it began to expand outward, becoming a monopoly on many other products, such as salt and paper.

Where there were no water conservancy, warrior and priest organizations, the monopoly extended to other regions partly because of a lack of scale, and partly because the consumer group was dominated by other monopoly organizations.

One aspect of monopoly expansion is the diminishing “entrepreneurial spirit” and increasing “bureaucracy” of businessmen looking for so-called “safe zones of investment protection shells created using political influence” (also the political asylum available to productive capital).

Another aspect is pressure from within the government itself to expand areas that do not involve violence but are closely related to military power. Today, atomic physics has become a sensitive field, with some scientific and engineering services being monopolized by the government in the name of national security.

In the nineteenth century, railway construction was of overwhelming military importance in many countries.

In the late Middle Ages and early modern times, camps for and against monopolies clashed in maritime transport, which was strategically placed in both commercial and political competition. Organized and protected shipping activities monopolize the control of cargo holds, which gives them the monopoly power to buy and sell goods in ports.

From the supervision of shipping by the Venice Commune, it can be clearly seen that China has broken the chain from protection monopoly to transportation monopoly to transportation of goods monopoly. **Its government is tightly controlled by a group of mostly wholesale merchants, and they are very opposed to monopoly sales in the Venetian market. The movement of goods from the ports of the Levant to Venice is not a natural monopoly.

Purely from a nautical point of view, it is more advantageous for ships to sail on various routes at different times and to offer competitive services. However, because of the advantages of scale in organizing protection, ships were instructed to accompany the fleet in times of danger, so Venetian merchants could only use these fleets to carry specific cargoes if they wished to transport goods. So, when shipping defense becomes a monopoly in this way, only a limited number of ships can provide cargo space to shippers.

Since ship operators are also merchants by nature, they seek to use their control over cargo spaces to secure a monopoly on the purchase or sale of goods shipped in Cyprus or Venice.

The Venetian government resisted this cargo monopoly by managing fleets escorted by soldiers as public transport, and it did encounter many difficulties in getting these regulations into effect. By contrast, the Portuguese kings, the Dutch East India Company, and many others had combined monopolies for protection, transport, and transport of goods in the first two centuries of maritime commerce.

**Since monopoly is more efficient in some areas and competition is more efficient in others, their distribution in the economy affects the total output of wealth, but is not a determinant of the total. **To name two examples, in the ongoing struggle between monopoly and competition in Venetian shipping or the British colonial trade, it is impossible to make a full impact assessment of their output of goods and services.

Monopoly does not only affect efficiency. It also brings more or less freedom and equality, more or less security and stability; these determine the outcome of the conflict between monopoly and competitive forces.

The continuous stride towards happiness, virtue and justice is the ultimate goal of human endeavor.

We cannot understand the people involved in this battle if we do not explore what freedom and security meant in that era and society, and how people connected liberty, security and happiness, virtue and justice.

Therefore, we should evaluate monopoly not only from the perspective of efficiency, but also from the perspective of justice.

Augustine declared: “What is the government without justice, a great robbery?”

In his view, the following can be said about any economic organization: Without justice, what business is there but stealing?

The government’s monopoly on violence, even if it is out of justice itself, also creates other bad monopolies. On the one hand, the reason is that the production efficiency is not high in the fields where the monopoly advantage cannot be formed in scale; the other reason is that in the field with the monopoly advantage in scale, the effect of improving efficiency and the negative effect of loss of freedom and justice interact with each other. offset.

In short, there are at least two aspects to the function of government that I analyze.

One is to provide producers with the necessary protection services and to use their costs and prices to influence the amount and distribution of material wealth through the organization of commercial activities that protect, use and control violence.

Another aspect is that, as natural monopolies, they will also affect the degree of monopoly in other fields of production, which in turn affects interpersonal relationships in the entire economic system.

In my opinion, the second aspect is more important, because I believe that understanding the social conditions of people’s efforts to earn a living and accumulate wealth is the cornerstone of understanding economic history.

We want to know what problems people face in their daily lives and at work, and what they are doing to solve them.

The link between their daily life and production is also very strong, so part of our answer can be found in the statistics of the calories they expend, the type of diet, and other material needs they meet. Descriptions of technological processes, the emergence of new technologies, and commercial activities also form part of the answer.

But how people get along in the production process is more important than how they handle soil, plants or tools. **To understand what a person is like, it is first necessary to understand how they treat other people, their productivity is only one factor that reflects their behavior.

In my opinion, economics is wrong in its interpretation of history because it claims that economic factors are the most important causes.

If the focus is on economic growth, that means the quantity of material goods is the most important outcome. But this is not the case. Knowledge of production and technological change is crucial, not so much for knowledge itself as for understanding the social structure of production.

Fundamentally, the way people get along when they produce material goods is more important than the goods themselves.

While many of us do not believe in economic interpretations of history, we also have a feeling that economic history is in a sense the most important part of history.

We believe that understanding the economic life of any society is a key foundation for understanding that society, not because production is the only and important reason for shaping culture, nor because production can be progressive and innovative, but because The characteristics manifested in economic activities constitute the largest part of people’s daily life.

Most people spend most of their time working for a living, and for them, the value of their existence is not just their personal aspirations or verbal thoughts, but their personal character and specific actions that are reflected in their day-to-day livelihoods middle.

If bullying and flattery, arrogant commands and servile obedience are the norm in economic life, then that is what humans are—that is what society is like.

On other topics—religious desire, artistic emotion, and creative intellect—for their own sake, they deserve endless historical research, even if they have no apparent connection to social organization, but any interest in justice, liberty, or society Historians interested in life should focus primarily on the interpersonal relationships in the processes of production and distribution.

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