This question was inspired by the threat on Honduras private cities. Perhaps this question has been asked before...
Imagine there is an anarcho-capitalist society. Why won't it dissolve into a feudal society? A number of corporations buy off large chunks of land and become absolute masters of what goes on on the bought land. Or, perhaps, they start off with offering protection services -- but then the contracts evolve into de facto (or de jure) land ownership.
Which is basically what happened in many societies that had become feudal. For instance, many Polish/Ukrainian peasants had colonized the Western bank of Dnieper river in what is today Ukraine. They suffered from attacks by Tatars and Turks and welcomed Polish armed aristocracy that offered them protection in return for taxes. Over a couple centuries that evolved into the Polish lords having absolute power over the peasants to the point that they were treated worse than domestic animals.
(It's true that in many cases peasants were conquered by lords of a different society -- which eventually happened to the Ukrainian peasants who became slaves of first Cossack, then Russian masters. But in many cases the feudal system formed de novo as I have described.)
So, someone like Nozick may say: at least under minarchism we have a system with self-imposed restrictions from within the society. But under anarcho-capitalism, economies of scale will lead to feudalism, where huge corporations might be absolute rulers over their land and anyone who lives on it, and existing legal system (funded by these corporations) will recognize overlordship of property owners over their tenants.
I am looking for an economic explanation of why this wouldn't happen (or is unlikely to happen).
In general, when anarcho-capitalists say that "all roads will be privately owned" and "there won't be public space", it seems that they envision many patches of privately owned land, many owners competing with each other for quality of offered (road) service; plus, many different protection agencies offering their services within a single city, akin to today's cell phone service providers.
But why won't it become "company X owns New York City; company Y owns New Jersey", each company provides all services (from protection to road) in a given chunk of territory, has absolute power over what goes on -- and... basically we have many small absolutist states.
Good luck.
@FlyingAxe
Roderick Long gave a speech Libertarian Anarchism: Responses to 10 Objections. A couple of his points should address your question - number 10 specifically is about Nozick. Anyway, this is worth reading even if it doesn't answer your question.
Well, it's all speculation really. There isn't necessarily an a priori reason why the scenario you describe wouldn't take place, but there isn't an a priori reason why it would either. The first objection to it comes from increased competition, both between alternative means of law-enforcement and between all established means and the possibility of establishing new means elsewhere.
You could argue that somehow these corporations have monopolised the world, but that's begging the question. How did that come to happen? I really don't see such bodies being so dominant in a world where simply having access to free money is nearly as easy as it is for them today. And also I should note that just because roads etc. aren't 'public property' (i.e. state property) doesn't mean that they are not owned by the local communities rather than by specific road companies or corporations.
Y'know I would say it's a worryingly realistic objection. Private power is absolute. The safeguard is supposed to be the decentralization brought about by price action and the precedent that one could own one's own property. Libertarians ought to realize that privatization is extremely difficult to conscionably execute. With the power that gigantic corporations wield inside gigantic states, I do fear that anarcho-capitalism could be a 'backdoor' so to speak.
On this issue we should refer to Konkin's ideas on the legitimacy of property: state land grants are not legitimate claims to land. When large plots of land become concentrated due to state action, they ought to be busted up into smaller plots. Those people in Honduras ought not to recognize the title of the owner of that city. In my opinion, state privatization is not a palatable AnCap scenario. Libertarians ought not to defer to private property titles out of hand simply out of an ideological resistance to the demonization of property.
The Anarch is to the Anarchist what the Monarch is to the Monarchist. -Ernst Jünger
It all really depends on the context: the character of the stateless society, how it came into being, the makeup of other societies if any.
Here's a motto I would suggest Misesians/Libertarians/AnCaps REFRAIN from adhering to: "Statelessness no matter the cost."
To add a small bit to what has already been said:
As I understand anarcho-capitalism and the decentralization of power, all people would be free to secede from any voluntary institution/arrangement. So property owners would be able to escape from a corporate-feudal system, even if that means that they can no longer buy the goods and services from said corporation. Thus the seceding property owners could work together (catallacty) to provide the goods and services they want.
As far as people that don't own property, but maybe rent: I think a free people would see the value in owning property, even if just a small amount. But who knows.
The only one worth following is the one who leads... not the one who pulls; for it is not the direction that condemns the puller, it is the rope that he holds.
How Could A Voluntary Society Function?
This deals with your question.
@Nielso - I don't mean to be rude, but I don't think people watch your videos when you just post them like that in the middle of a specific discussion.
@Phi - I think that after a period of time, people living under corporate-feudalism could eke out the savings to buy property on which to live, out from under the sovereignty of the corporate forms. The question, to me, is: how long a period of time, and how painful a one? Corporations today share the power with the state as families share dinner. If one handed over all the land of the country to corporations, it is conceivable that they would be handed to a very small few of them (TPTB). In which case they might be in an economic situation wherein they are capable of not putting up land for sale and making a new society much like that of Imperial Russia, though much richer.
@Jargon
When Nielsio posts his shorter videos (15min or less), I typically watch them - well, I've seen most of his videos now, so I don't need to watch some of the ones he posts. I've seen some of his longer videos (~40min), but I don't think he posts those very much.
Perhaps more people have watched them than you think. That particular video has almost 25k views.
@gotlucky - I don't doubt that his videos are well-made and well-watched, nor is it my intention to diminish them.
Oh I know, I'm just saying I think that some people do watch his videos even when he just inserts them with little comment.
Market relations require a certain parity of status among the actors within the market. That is, they are held to the same, or roughly similar, de facto standards of practice for ownership, trade, various liberties such as speech and association, and enjoy the same legal protections and privileges. All of this is prior to the market itself. Market processes cannot establish the shared meanings and common understandings that make market interactions possible in the first place.
The problem that anarcho-capitalism has, and most other liberal theories have, is that it confuses an approximate biological equality for an equality of social-legal status. Human beings are not inherently socially equal. This equality must be provided for by some institutional arrangement that produces mutual recognition of the appropriate identities and practices.
Anarcho-capitalist theorists, as far as I know, have not proposed a theory of how these prior meaning-practices are established and instead have focused more on the analytic task of devising internally consistent rule systems. Unfortunately the premises of voluntaryism and non-initiation of aggression can be applied to just about any political theory. The voluntariness of an interaction and the aggressive or defensive character of violence are not embedded, objective facts of a particular act, but are theory laden interpretations of behavior that are dependent upon certain understandings of the status of the individuals involved and their legitimate holdings. A different understanding can result in a different interpretation and therefore what constitutes aggression and voluntariness is not constant but dynamic, contingent upon the given meaning-practice of a social group.
The best that anarcho-capitalist theory has establish as yet is some form of evolutionary competition, which a feudalistic social organization is most definitely a possibility.