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Blog: Unfeasible Contracts in an Ancap Society

I’m reading David Hathaway’s book Immigration: Individual vs National Borders, and he made an interesting point.

Not every private contract is enforceable. Example: cartels fail because each party benefits if they violate the agreement to refrain from lowering their prices. He argues that in a fully privatized society, contracts to exclude foreigners would fail for similar reasons. Many participants of the agreement would benefit by doing business with foreigners, and it may very well be unfeasible to enforce the original agreement.

He also claims that HOAs (referred to by some as covenant communities) are not market creations.

“These oft-despised sources of collectivist controversy are primarily the result of modern era government requirements that mandate the existence of neighborhood restrictions and HOAs to enforce them in order to for new housing developments to quality for FHA/VA loan financing (the source of most home financing in the U.S.).”

I’m not sure what to make of this tbh. Perhaps some libertarians rely too heavily on the HOA model as an alternative to the state.

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