Indians and Property Rights
I am teaching a few classes on the economics of property rights in my Environmental Economics courses, when the following things occurred to me:
- In 1626, Peter Minuit acquired Manhattan Island from the native Indians for 60 guilders, which is said to have been the approximate of $1,000 now. If the Indians had invested that money in an asset earning a real return of just 5% per year, that would be worth over $118 billion today. If they had been lucky enough to earn a real return of 8% per year, that measly sum would be worth … $5.426 QUADRILLION. That is obviously a little high, total world GDP today is $66 trillion.
- Most of Massachusetts was acquired by the English settlers via voluntary exchange.
- Manhattan island is LIGHTER in weight today than it was at the time the Manhattan Indians owned it (thanks to my colleague Ron Jones for pointing this out!)