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Sunday, October 31, 2010


Social Contract Theory

The United States of America is considered to be one of the most prosperous nations in history. The country fares well in traditional economic rankings such as GDP, and has a history full of innovation and progress. The founders of this great country set out to develop a new nation in the sight of God. However, they did not create their new society from scratch. They were profoundly influenced by a variety of authors from the 1700s. Whether one believes Locke or Montesquieu was their chief resource does not matter for the matter at hand. It cannot be debated that the founders had read the writings of John Locke. Locke along with many of his contemporaries embraced the notion of a social contract between people that served as the foundation of government. Yet in his book The Logic of Collective Action, Mancur Olson posits that large groups are unlikely to mobilize for the provision of a collective good without some type of selective incentive or the use of force. Olson examines many societies in various periods of history. The purpose of this blog is not to suggest a new political theory, but to point out an oft unnoticed aspect of social contract theory.

Olson explains that the purpose of a group is the provision of a collective good which is something that benefits everyone in the group’s associated area regardless of whether or not individuals help the group obtain the good. The collective good nature of groups means that people will have an incentive to avoid working for the group since they will get the good whether or not they help out. In small groups Olson provides examples for how this can be overcome with a major player who places such a high value on the collective good that he or she will provide it in some quantity with or without help from the group, but he shows that in large groups the members will not help provide a collective good. To any member of a large group the costs of providing a collective good will outweigh his or her personal benefit. The very idea of social contract implies a large group of people bound by no similarity other than a common locality and a desire for some occurrence that will lead to easy protection of person and property.

The first person to develop the idea of social contact was Thomas Hobbes. According to Hobbes, a social contract between members of a society in necessary to move men from war, the state of nature, to peace. Men are able to achieve peace only by signing their alienable rights over to a ruling body that is created to uphold the contract. Inalienable rights such as the right to self-defense and the right to resist slavery are not given up, but other rights are consigned to the government for all time. The contract is a “voluntary act: and of the voluntary acts of every man, the object is some good to himself” (Hobbes 88). Social contract theorists are correct in asserting that man could conceivably achieve a benefit from signing over alienable rights to government if that ends the unpromising state of nature. However, signing the contract requires the formation of a large group. Every individual has an incentive to be a hold out and not sign the contract. People would encourage their neighbors to sign and thereby become less dangerous neighbors, but the encourager would have no incentive to sign on before everyone else. In fact, being one of the first to sign on could be dangerous. Signing early would require trusting the forming government to protect one’s property against vagabonds that had not yet signed on. Even more significant are the doubts individuals would have about the contract’s authenticity. They would have no reason to trust even their fellow signers since just days before they had been at war with each other. Furthermore, what individual would have the incentive to go around educating others about the possibility of a contract? This individual would need some way to have his person and property protected as he or she traveled.

It seems that a social contract would be difficult to achieve. With this difficulty it is unlikely that man would ever have moved from the state of nature whether that was war as Hobbes suggested or the less fearsome state Locke proposed. Given the situation force could be used to compel other potential members of society to agree, but forced contracts are not considered binding by the law. People would have had one more reason to renege under a forced contract. Therefore, social contracts must rely on some type of selective incentive to fit in with Mancur Olson’s theory.


Hobbes, Thomas. Leviathan. Oxford University Press, 1651. Print.

Olson, Mancur. The Logic of Collective Action. Print.

I tend to think of a social contract as a useful conceptual tool, not as an explanation of government. Given that government is force, it seems to me that the concepts of Locke, and as written into the Declaration by Jefferson, are the best way to think of the individual vis a vis government. It seems the best way to judge whether a government uses force justly or unjustly.

Of course, there is then the question of how the "entity with the greatest capacity for violence" turns out to be a republican form of government such as ours. It seems to me the positive explanation of such events will likely follow along with Olson's discussions.

But, there is another interesting suggestion to consider with respect to our country. Gordon Wood (American Revolution, I think) explains that there was a view after the revolution among many that "the country" was very much "in a state of nature," in that the old government has been thrown off (consistent perhaps with the Declaration). Wood says there was the explicit conceptual idea that people could now move from the state of nature by granting a new government powers.
I think the chapters of Power and Prosperity we have read recently give a better explanation than Hobbes. I have never heard Wood's view. It sounds like something interesting to research.
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