I recently observed an intriguing example of the evolution of a private property, market-based spontaneous order at my children’s elementary school. A group of fourth and fifth graders created a set of playground rules analogous to those I learned about in my work on spontaneous orders in the nineteenth-century gold rushes throughout the western United States. I was pleased, but not surprised, to find that fourth and fifth graders created a solution to a playground problem based on property rights and markets.
My children attend a Montessori elementary school in Cleveland Heights, Ohio. My older daughter, Kathleen, is in the fifth grade. At this school, as in all Montessori schools, children are grouped in multi-grade classrooms—Kathleen’s has fourth and fifth graders together in each of two classrooms. Although the classrooms work separately on most academic subjects, activities like recess are joint. There are thus about 60 children (with four teachers and aides) in the two classes, with a slight preponderance of girls.
The school grounds are not large, although there is a playground plus a large playing field shared with a neighboring Catholic girls’ high school. One of the locations that attracts many of the fourth and fifth graders is “the woods,” an area of bushes and trees that lies along the border between the school parking lot and playground and the shared athletic field. Here the fourth- and fifth-grade children have created a series of “houses” under various bushes and trees and an economy based on a pine-cone currency. I found what my daughter told me about their games fascinating, so I interviewed a large group of her classmates about how they play in the woods.
Establishing Property Rights
On the first day of a school year, children claim their houses by marking off boundaries with various materials (rocks, sticks, logs) that they find in the woods. They then devote considerable effort to improving their houses—adding furniture constructed from materials found in the woods (by common agreement outside materials cannot be brought into the woods). Some create “stores” in which they “sell” materials they create such as “paints” made by pounding plants and rocks into dusts. Others have “hotels” where the homeless (children who come late to the game) can rent rooms until they can negotiate to join an existing house. Additional rooms are added to houses by clearing space under nearby bushes and trees or by purchasing them from neighbors. The rights to a space demarcated in this fashion appear to be widely accepted by both those playing in the woods regularly and the fourth and fifth graders who choose to do something else. (A regular soccer game is a major alternative.)
Only two groups failed to respect the property rights the children had established. One was a group of three-, four-, and five-year-olds (who have a different recess period) and who, although technically forbidden from playing in the woods, sometimes crashed through the houses in a herd. The second was a group of elementary-age children from another school who sometimes used the adjacent athletic field.
In creating their property rights in this fashion, the children are behaving like the miners who flooded into the American west in 1848–1849 and later years. Like the children at my daughter’s school, miners would appear in large numbers in an area of limited physical resources. Like the children, the miners quickly developed simple rules that guaranteed their property rights. Like the rules developed at the school, the miners’ rules were respected by latecomers.
Also like the miners (and like most legal systems), the children have developed a concept of adverse possession. Houses left vacant for extended periods (all agreed it was more than one week and less than a month) could be occupied by others, whose title to the property would be recognized by the group. Use of property was thus encouraged. Similarly the miners in the gold rush respected claims left unoccupied for short periods while their owners went for supplies, so long as the claim was marked in some fashion.
Property claims in both systems extended to moveable property. The western miners often left piles of gold ore and valuable supplies in their camps, unguarded out of necessity, while the miners sought more gold. By all accounts, thefts from the unguarded camps were comparatively rare. Similarly, the children leave their stashes of pine cone currency unguarded as well as their collections of materials.
While no children’s game would be complete without disputes, this game seems remarkably free of disputes in many respects. In part this is because the clear property rights in their houses give each child a space free from outside interference to play as each wishes. Unlike the commons of a playground, where one group’s fantasy game on the jungle gym could be interrupted by another group that insists on its equal right to occupy the space for a game of tag, no group of children can impose on another by disrupting a game in progress. I suspect that one of the major attractions of the woods as a play space stems from the control those property rights provide.
Only one major property rights dispute occurred during the past school year. One child claimed a house occupied by another group of kids. The issue was not decided on a “might makes right” basis. Instead all agreed to choose an uninvolved child as the “judge” and to conduct a court to settle the issue. After the first candidate for judge was rejected as potentially biased, they settled on a child whom several described as the “smartest kid in the class.” Each side then found a “lawyer” to present its case, and presented and cross-examined witnesses. After a reportedly dramatic presentation of factual inconsistencies in one side’s story, the judge decided for the other side. All accepted the decision—no appeal was lodged with the teachers.
This brings us to another important point. One question always raised about privately based legal systems is the extent to which such systems ultimately depend on external enforcement of the rules they create. There was no such outside authority during the gold rush because the miners were too far from established centers of political authority to appeal to the state. In the rare case that there were nearby military authorities, the tendency of troops to desert to the mines at every opportunity restricted the availability of government force. Surely children in an elementary school, however, could appeal to their teachers to settle disputes.
As part of the Montessori teaching method, the teachers at the school emphasize that the children must solve their own disputes. When I questioned the kids about whether the teachers were available to settle property boundary disputes and the like, they unanimously agreed that the teachers were no help at all. “They just tell us to work it out,” one complained. Another agreed that “the teachers just do what they always do, ask us how we’ll figure it out ourselves.” Indeed, the children agreed that they did not often seek assistance from the teachers since any major dispute could result in the entire class being told they could not play in the woods for a week while tempers cooled.
Of course, the children are not playing in a state of nature, as the nineteenth-century miners were. The threat of a trip to the principal’s office exists for those who attempt to attack others on the playground. Punching another student is not the only way to use violence, however. In my school days the successful school bullies were the masters of applying force in ways unnoticeable to the teachers. One of the things that struck me most about “the woods” was the absence of any evidence of such behavior.
In the first gold rushes, miners frequently made rules forbidding sale of claims in an attempt to discourage “speculation.” These rules rarely lasted more than a few months as both the new arrivals and original appropriators quickly realized the mutual benefits that trade made possible. Because children often tend to have absolutist ideas about property (at least when it comes to sharing with siblings), I was curious to see how the children dealt with issues surrounding potential exchange of property rights.
Using pine cones as currency, the children developed a cash economy. One could sell goods (items found in the woods), natural resources (kids dug for stones), and labor (owners frequently hired “sweepers” to clean their houses). Alternatively, while pine cones were relatively scarce commodities, they could be directly harvested by investing time in a search. Property rights in houses were freely alienable and changed hands fairly often. Groups of children who played together might break up and some seek new homes; newcomers might join the game or players might decide to switch to soccer and “cash out.” Like the gold miners, the children intuitively understood the concept of comparative advantage.
In addition, the overall game rewarded entrepreneurial activity. Children who thought of new uses for the property were able to accumulate significant pine-cone stashes. One group built a “golf course” and charged to play; many others sold particular items and rented rooms.
Interestingly the children resisted destabilizing their currency and society by importing outside pine cones. The Cleveland area has many trees and parks and pine cones are readily available with much less effort than “sweeping” another’s house in the woods, yet no one seemed to consider importing pine cones as an alternative source of income. When I walked in areas thick with pine cones with my daughter and her friends, they resisted my suggestion to gather any of the “money” lying on the ground.
The establishment of houses in the woods is a longstanding game, handed down from class to class. Much as the experienced gold miners known as “old Californians” transmitted miners’ law throughout the western United States mineral rushes, the fifth graders hand down the oral tradition of the rules for play in the woods. Thus it is easy to see how the tradition has perpetuated itself.
I should stress, however, that this is not the “Ayn Rand Learning Center” made famous in an episode of the Simpsons. The Montessori system does not include any significant economics content (at least through the fifth grade) and certainly no study of Austrian economics. No U.S. history is taught before the middle school, so the children have not studied the gold rush. Even the fifth graders are barely through ancient civilizations and so unlikely to have devoted much time to studying the developments of markets or trade. Thus they haven’t learned market solutions or property rights from a textbook.
They might have learned these lessons at home but these children are also not, as far as I can tell, drawn from libertarian homes that emphasize such things. For example, as a rough proxy of the political climate, in 1996 Bill Clinton overwhelmingly won a straw poll against Bob Dole and Ross Perot in my daughter’s lower elementary class (Harry Browne didn’t even make the ballot). Thus they are no more likely than any other group of suburban fourth-grade and fifth-grade kids to have spent much time pondering markets and property rights outside school.
I think there are two explanations for the emergence of a private-property, market-based spontaneous order among my daughter and her classmates. First, the Montessori curriculum puts a heavy emphasis on children learning to solve their own problems. As noted above, the teachers do not intervene to resolve disputes among children other than to restrict the use of force and direct the children toward means of settlement. Appeals to outside authority are thus unavailable except where a child attempts to use force. Since no one controls the game, the children were forced to develop mechanisms that respected the autonomy of the other children and made peaceful interactions possible. Whenever the first fourth and fifth graders hit on such a solution, its advantages would have become immediately apparent.
Second, and more important, markets and property rights are natural in a way that authoritarian structures are not. The freedom such solutions provide is just what many children desire (and plenty of adults too!). My daughter and her classmates intuitively know how to facilitate the development of their own spontaneous order that enables them to play the games they want to play while accommodating their classmates’ desires to play differently. These children have discovered how to coexist in an environment of diverse interests.
Learning from Kids
There are obviously huge differences between the nineteenth-century American gold rushes and my children’s elementary school. Nonetheless the systems of rules and property rights that evolved in both have significant features in common: a reliance on private property rights and market exchange, a limited set of rules facilitating individuals acting in their own interest, and limited resort to outside sources for rule enforcement. It is no accident that these features appear in such a diverse set of social orders. It is precisely because they are so easily generalizable that market-based systems of property rights can accommodate both elementary schoolchildren’s games and a gold rush.
The rule of law takes effort to establish, of course. The nineteenth-century miners had to rely on their own resources to set it up. The children can rely on the “night watchman” state provided by the teachers and administration to prevent violence. What is striking is how little intervention was needed to establish peace and good order among both the thousands of mostly single young men who flocked to the gold fields and the fourth and fifth graders described here. It is hard to imagine groups less likely to fall naturally into an orderly society on their own than gold miners and schoolchildren. That they both accomplished it so easily speaks well for our chances to do so on a larger scale.
Many adults could learn quite a bit from the children in my daughter’s class. The students found their way to a means of allocating private property rights in a desirable area of the playground that gives each the freedom to play as he or she sees fit without impinging on the rights of others. If more adults imitated such behavior in their lives, we would be much closer to a society of free and responsible individuals.