Building a Framework for Reliable Underwriting San Antonio, TX

This article needs additional citations for verification. Please help improve this article by adding citations to reliable sources. Unsourced material may be challenged and removed. Find sources: "Property" – news · newspapers · books · scholar · JSTOR (July 2017) (Learn how and when to remove this message)

This article is written like a personal reflection, personal essay, or argumentative essay that states a Wikipedia editor's personal feelings or presents an original argument about a topic. Please help improve it by rewriting it in an encyclopedic style. (September 2015) (Learn how and when to remove this message)

This article has multiple issues. Please help improve it or discuss these issues on the talk page. (Learn how and when to remove these messages)

(Learn how and when to remove this message)

Property is a system of rights that gives people legal control of valuable things,^[1] and also refers to the valuable things themselves. Depending on the nature of the property, an owner of property may have the right to consume, alter, share, rent, sell, exchange, transfer, give away, or destroy it, or to exclude others from doing these things,^[2] as well as to perhaps abandon it; whereas regardless of the nature of the property, the owner thereof has the right to properly use it under the granted property rights.

In economics and political economy, there are three broad forms of property: private property, public property, and collective property (or cooperative property).^[3] Property may be jointly owned by more than one party equally or unequally, or according to simple or complex agreements; to distinguish ownership and easement from rent, there is an expectation that each party's will with regard to the property be clearly defined and unconditional.^{[citation needed]}. The parties may expect their wills to be unanimous, or alternatively each may expect their own will to be sufficient when no opportunity for dispute exists. The first Restatement defines property as anything, tangible or intangible, whereby a legal relationship between persons and the State enforces a possessory interest or legal title in that thing. This mediating relationship between individual, property, and State is called a property regime.^[4]

In sociology and anthropology, property is often defined as a relationship between two or more individuals and an object, in which at least one of these individuals holds a bundle of rights over the object. The distinction between collective and private property is regarded as confusion, since different individuals often hold differing rights over a single object.^[5][6]

Types of property include real property (the combination of land and any improvements to or on the ground), personal property (physical possessions belonging to a person), private property (property owned by legal persons, business entities or individual natural persons), public property (State-owned or publicly owned and available possessions) and intellectual property—including exclusive rights over artistic creations and inventions. However, the latter is not always widely recognized or enforced. An article of property may have physical and incorporeal parts. A title, or a right of ownership, establishes the relation between the property and other persons, assuring the owner the right to dispose of the property as the owner sees fit.^{[citation needed]} The unqualified term "property" is often used to refer specifically to real property.

Property law
Part of the common law series
Types
Personal property Community property Real property Unowned property
Acquisition
Gift Adverse possession Deed Conquest Discovery Accession Lost, mislaid, and abandoned property Treasure trove Bailment License Alienation
Estates in land
Allodial title Fee simple Fee tail Life estate Defeasible estate Future interest remainder Concurrent estate Leasehold estate Condominiums Real estate Land tenure
Conveyancing
Bona fide purchaser Torrens title Strata title Deeds registration Estoppel by deed Quitclaim deed Mortgage Equitable conversion Action to quiet title Escheat
Future use control
Restraint on alienation Rule against perpetuities Rule in Shelley's Case Doctrine of worthier title
Nonpossessory interest
Lien Easement Profit Usufruct Covenant Equitable servitude
Related topics
Fixtures Waste Partition Practicing without a license Property rights Mineral rights Water rights prior appropriation riparian Lateral and subjacent support Assignment Nemo dat Quicquid plantatur Conflict of property laws Blackacre Security deposit
Other common law areas
Contract law Tort law Wills, trusts and estates Criminal law Evidence Higher category: Law and Common law

Property is often defined by the code of the local sovereignty and protected wholly or - more usually, partially - by such entity, the owner being responsible for any remainder of protection. The standards of the proof concerning proofs of ownerships are also addressed by the code of the local sovereignty, and such entity plays a role accordingly, typically somewhat managerial. Some philosophers^[who?] assert that property rights arise from social convention, while others find justifications for them in morality or in natural law.^{[citation needed]}

Various scholarly disciplines (such as law, economics, anthropology or sociology) may treat the concept more systematically, but definitions vary, most particularly when involving contracts. Positive law defines such rights, and the judiciary can adjudicate and enforce property rights.

According to Adam Smith (1723–1790), the expectation of profit from "improving one's stock of capital" rests on private-property rights.^[7] Capitalism has as a central assumption that property rights encourage their holders to develop the property, generate wealth, and efficiently allocate resources based on the operation of markets. From this has evolved the modern conception of property as a right enforced by positive law, in the expectation that this will produce more wealth and better standards of living. However, Smith also expressed a very critical view of the effects of property laws on inequality:^[8]

Wherever there is a great property, there is great inequality … Civil government, so far as it is instituted for the security of property, is in reality instituted for the defense of the rich against the poor, or of those who have some property against those who have none at all.

In his 1881 text "The Common Law", Oliver Wendell Holmes describes property as having two fundamental aspects.^{[citation needed]} The first, possession, can be defined as control over a resource based on the practical inability to contradict the ends of the possessor. The second title is the expectation that others will recognize rights to control resources, even when not in possession. He elaborates on the differences between these two concepts and proposes a history of how they came to be attached to persons, as opposed to families or entities such as the church.

• Classical liberalism subscribes to the labor theory of property. Its proponents hold that individuals each own their own life; it follows that one must acknowledge the products of that life and that those products can be traded in free exchange with others.

"Every man has a property in his person. This nobody has a right to, but himself." (John Locke, "Second Treatise on Civil Government", 1689)

"The reason why men enter into society is the preservation of their property." (John Locke, "Second Treatise on Civil Government", 1689)

"Life, liberty, and property do not exist because men have made laws. On the contrary, it was the fact that life, liberty, and property existed beforehand that caused men to make laws in the first place." (Frédéric Bastiat, The Law, 1850)

• Conservatism subscribes to the concept that freedom and property are closely linked - building on traditions of thought that property guarantees freedom^[9] or causes freedom.^[10] The more widespread the possession of the private property, conservatism propounds, the more stable and productive a state or nation is. Conservatives maintain that the economic leveling of property, especially of the forced kind, is not economic progress.

"Separate property from private possession and Leviathan becomes master of all... Upon the foundation of private property, great civilizations are built. The conservative acknowledges that the possession of property fixes certain duties upon the possessor; he accepts those moral and legal obligations cheerfully." (Russell Kirk, The Politics of Prudence, 1993)

• Socialism's fundamental principles center on a critique of this concept, stating (among other things) that the cost of defending property exceeds the returns from private property ownership and that, even when property rights encourage their holders to develop their property or generate wealth, they do so only for their benefit, which may not coincide with advantage to other people or society at large.
• Libertarian Socialism generally accepts property rights with a short abandonment period. In other words, a person must make (more-or-less) continuous use of the item or else lose ownership rights. This is usually referred to as "possession property" or "usufruct." Thus, in this usufruct system, absentee ownership is illegitimate, and workers own the machines or other equipment they work with.
• Communism argues that only common ownership of the means of production will assure the minimization of unequal or unjust outcomes and the maximization of benefits and that; therefore humans should abolish private ownership of capital (as opposed to property).

Both communism and some forms of socialism have also upheld the notion that private ownership of capital is inherently illegitimate. This argument centers on the idea that private ownership of capital always benefits one class over another, giving rise to domination through this privately owned capital. Communists do not oppose personal property that is "hard-won, self-acquired, self-earned" (as "The Communist Manifesto" puts it) by members of the proletariat. Both socialism and communism distinguish carefully between private ownership of capital (land, factories, resources, etc.) and private property (homes, material objects, and so forth).

Most legal systems distinguish between different types of property, especially between land (immovable property, estate in land, real estate, real property) and all other forms of property—goods and chattels, movable property or personal property, including the value of legal tender if not the legal tender itself, as the manufacturer rather than the possessor might be the owner. They often distinguish tangible and intangible property. One categorization scheme specifies three species of property: land, improvements (immovable man-made things), and personal property (movable man-made things).^[11]

In common law, real property (immovable property) is the combination of interests in land and improvements thereto, and personal property is interest in movable property. Real property rights are rights relating to the land. These rights include ownership and usage. Owners can grant rights to persons and entities in the form of leases, licenses, and easements.

Throughout the last centuries of the second millennium, with the development of more complex theories of property, the concept of personal property had become divided^{[by whom?]} into tangible property (such as cars and clothing) and intangible property (such as financial assets and related rights, including stocks and bonds; intellectual property, including patents, copyrights and trademarks; digital files; communication channels; and certain forms of identifier, including Internet domain names, some forms of network address, some forms of handle and again trademarks).

Treatment of intangible property is such that an article of property is, by law or otherwise by traditional conceptualization, subject to expiration even when inheritable, which is a key distinction from tangible property. Upon expiration, the property, if of the intellectual category, becomes a part of public domain, to be used by but not owned by anybody, and possibly used by more than one party simultaneously due to the inapplicability of scarcity to intellectual property. Whereas things such as communications channels and pairs of electromagnetic spectrum bands and signal transmission power can only be used by a single party at a time, or a single party in a divisible context, if owned or used. Thus far or usually, those are not considered property, or at least not private property, even though the party bearing right of exclusive use may transfer that right to another.

In many societies the human body is considered property of some kind or other. The question of the ownership and rights to one's body arise in general in the discussion of human rights, including the specific issues of slavery, conscription, rights of children under the age of majority, marriage, abortion, prostitution, drugs, euthanasia and organ donation.

Of the following, only sale and at-will sharing involve no encumbrance.

The two major justifications are given for the original property, or the homestead principle, are effort and scarcity. John Locke emphasized effort, "mixing your labor"^[12] with an object, or clearing and cultivating virgin land. Benjamin Tucker preferred to look at the telos of property, i.e., what is the purpose of property? His answer: to solve the scarcity problem. Only when items are relatively scarce concerning people's desires, do they become property.^[13] For example, hunter-gatherers did not consider land to be property, since there was no shortage of land. Agrarian societies later made arable land property, as it was scarce. For something to be economically scarce, it must necessarily have the "exclusivity property"—that use by one person excludes others from using it. These two justifications lead to different conclusions on what can be property. Intellectual property—incorporeal things like ideas, plans, orderings and arrangements (musical compositions, novels, computer programs)—are generally considered valid property to those who support an effort justification, but invalid to those who support a scarcity justification, since the things don't have the exclusivity property (however, those who support a scarcity justification may still support other "intellectual property" laws such as Copyright, as long as these are a subject of contract instead of government arbitration). Thus even ardent propertarians may disagree about IP.^[14] By either standard, one's body is one's property.

From some anarchist points of view, the validity of property depends on whether the "property right" requires enforcement by the State. Different forms of "property" require different amounts of enforcement: intellectual property requires a great deal of state intervention to enforce, ownership of distant physical property requires quite a lot, ownership of carried objects requires very little. In contrast, requesting one's own body requires absolutely no state intervention. So some anarchists don't believe in property at all.

Many things have existed that did not have an owner, sometimes called the commons. The term "commons," however, is also often used to mean something entirely different: "general collective ownership"—i.e. common ownership. Also, the same term is sometimes used by statists to mean government-owned property that the general public is allowed to access (public property). Law in all societies has tended to reduce the number of things not having clear owners. Supporters of property rights argue that this enables better protection of scarce resources due to the tragedy of the commons. At the same time, critics say that it leads to the 'exploitation' of those resources for personal gain and that it hinders taking advantage of potential network effects. These arguments have differing validity for different types of "property"—things that are not scarce are, for instance, not subject to the tragedy of the commons. Some apparent critics advocate general collective ownership rather than ownerlessness.

Things that do not have owners include: ideas (except for intellectual property), seawater (which is, however, protected by anti-pollution laws), parts of the seafloor (see the United Nations Convention on the Law of the Sea for restrictions), gases in Earth's atmosphere, animals in the wild (although in most nations, animals are tied to the land. In the United States and Canada, wildlife is generally defined in statute as property of the State. This public ownership of wildlife is referred to as the North American Model of Wildlife Conservation and is based on The Public Trust Doctrine.^[15]), celestial bodies and outer space, and land in Antarctica.

The nature of children under the age of majority is another contested issue here. In ancient societies, children were generally considered the property of their parents. However, children in most modern communities theoretically own their bodies but are not regarded as competent to exercise their rights. Their parents or guardians are given most of the fundamental rights of control over them.

Questions regarding the nature of ownership of the body also come up in the issue of abortion, drugs, and euthanasia.

In many ancient legal systems (e.g., early Roman law), religious sites (e.g. temples) were considered property of the God or gods they were devoted to. However, religious pluralism makes it more convenient to have sacred sites owned by the spiritual body that runs them.

Intellectual property and air (airspace, no-fly zone, pollution laws, which can include tradable emissions rights) can be property in some senses of the word.

Ownership of land can be held separately from the ownership of rights over that land, including sporting rights,^[16] mineral rights, development rights, air rights, and such other rights as may be worth segregating from simple land ownership.

Ownership laws may vary widely among countries depending on the nature of the property of interest (e.g., firearms, real property, personal property, animals). Persons can own property directly. In most societies legal entities, such as corporations, trusts and nations (or governments) own property.

In many countries women have limited access to property following restrictive inheritance and family laws, under which only men have actual or formal rights to own property.

In the Inca empire, the dead emperors, considered gods, still controlled property after death.^[17]

In 17th-century England, the legal directive that nobody may enter a home (which in the 17th century would typically have been male-owned) unless by the owner's invitation or consent, was established as common law in Sir Edward Coke 's "Institutes of the Lawes of England". "For a man's house is his castle, et domus sua cuique est tutissimum refugium [and each man's home is his safest refuge]." It is the origin of the famous dictum, "an Englishman's home is his castle".^[18] The ruling enshrined into law what several English writers had espoused in the 16th century.^[18] Unlike the rest of Europe the British had a proclivity towards owning their own homes.^[18] British Prime Minister William Pitt, 1st Earl of Chatham defined the meaning of castle in 1763, "The poorest man may in his cottage bid defiance to all the forces of the crown. It may be frail – its roof may shake – the wind may blow through it – the storm may enter – the rain may enter – but the King of England cannot enter."^[18]

That principle was carried to the United States. Under U.S. law, the principal limitations on whether and the extent to which the State may interfere with property rights are set by the Constitution. The Takings clause requires that the government (whether State or federal—for the 14th Amendment's due process clause imposes the 5th Amendment's takings clause on state governments) may take private property only for a public purpose after exercising due process of law, and upon making "just compensation." If an interest is not deemed a "property" right or the conduct is merely an intentional tort, these limitations do not apply, and the doctrine of sovereign immunity precludes relief.^[19] Moreover, if the interference does not almost completely make the property valueless, the interference will not be deemed a taking but instead a mere regulation of use.^[20] On the other hand, some governmental regulations of property use have been deemed so severe that they have been considered "regulatory takings."^[21] Moreover, conduct is sometimes deemed only a nuisance, or another tort has been held a taking of property where the conduct was sufficiently persistent and severe.^[22]

There exist many theories of property. One is the relatively rare first possession theory of property, where ownership of something is seen as justified simply by someone seizing something before someone else does.^[23] Perhaps one of the most popular is the natural rights definition of property rights as advanced by John Locke. Locke advanced the theory that God granted dominion over nature to man through Adam in the book of Genesis. Therefore, he theorized that when one mixes one's labor with nature, one gains a relationship with that part of nature with which the labor is mixed, subject to the limitation that there should be "enough, and as good, left in common for others." (see Lockean proviso)^[24]

In his encyclical letter Rerum novarum (1891), Pope Leo XIII wrote, "It is surely undeniable that, when a man engages in remunerative labor, the impelling reason and motive of his work is to obtain property, and after that to hold it as his very own."^[25]

Anthropology studies the diverse ownership systems, rights of use and transfer, and possession^[26] under the term "theories of property". As mentioned, western legal theory is based on the owner of property being a legal person. However, not all property systems are founded on this basis.

In every culture studied, ownership and possession are the subjects of custom and regulation, and "law" is where the term can meaningfully be applied. Many tribal cultures balance individual rights with the laws of collective groups: tribes, families, associations, and nations. For example, the 1839 Cherokee Constitution frames the issue in these terms:

Sec. 2. The lands of the Cherokee Nation shall remain common property. Still, the improvements made thereon, and in possession of the citizens respectively who made, or may rightfully own them: Provided, that the citizens of the Nation possessing the exclusive and indefeasible right to their improvements, as expressed in this article, shall possess no right or power to dispose of their improvements, in any manner whatever, to the United States, individual States, or individual citizens thereof; and that, whenever any citizen shall remove with his effects out of the limits of this Nation, and become a citizen of any other government, all his rights and privileges as a citizen of this Nation shall cease: Provided, nevertheless, That the National Council shall have power to re-admit, by law, to all the rights of citizenship, any such person or persons who may, at any time, desire to return to the Nation, on memorializing the National Council for such readmission.

Communal property systems describe ownership as belonging to the entire social and political unit. Common ownership in a hypothetical communist society is distinguished from primitive forms of common property that have existed throughout history, such as Communalism and primitive communism, in that communist common ownership is the outcome of social and technological developments leading to the elimination of material scarcity in society.^[27]

Corporate systems describe ownership as being attached to an identifiable group with an identifiable responsible individual. The Roman property law was based on such a corporate system. In a well-known paper that contributed to the creation of the field of law and economics in the late 1960s, the American scholar Harold Demsetz described how the concept of property rights makes social interactions easier:

In the world of Robinson Crusoe, property rights play no role. Property rights are an instrument of society and derive their significance from the fact that they help a man form those expectations which he can reasonably hold in his dealings with others. These expectations find expression in society's laws, customs, and more. An owner of property rights possesses the consent of fellowmen to allow him to act in particular ways. An owner expects the community to prevent others from interfering with his actions, provided that these actions are not prohibited in the specifications of his rights.

— Harold Demsetz (1967), "Toward a Theory of property Rights", The American Economic Review 57(2), p. 347.^[28]

Different societies may have other theories of property for differing types of ownership. For example, Pauline Peters argued that property systems are not isolable from the social fabric, and notions of property may not be stated as such but instead may be framed in negative terms: for example, the taboo system among Polynesian peoples.

In medieval and Renaissance Europe the term "property" essentially referred to land. After much rethinking, land has come to be regarded as only a special case of the property genus. This rethinking was inspired by at least three broad features of early modern Europe: the surge of commerce, the breakdown of efforts to prohibit interest (then called "usury"), and the development of centralized national monarchies.

Urukagina, the king of the Sumerian city-state Lagash, established the first laws that forbade compelling the sale of property.^[29]

The Bible in Leviticus 19:11 and ibid. 19:13 states that the Israelites are not to steal.

Aristotle, in Politics, advocates "private property."^[30] He argues that self-interest leads to neglect of the commons. "[T]hat which is common to the greatest number has the least care bestowed upon it. Everyone thinks chiefly of his own, hardly at all of the common interest, and only when he is himself concerned as an individual."^[31]

In addition, he says that when property is common, there are natural problems that arise due to differences in labor: "If they do not share equally enjoyments and toils, those who labor much and get little will necessarily complain of those who labor little and receive or consume much. But indeed, there is always a difficulty in men living together and having all human relations in common, but especially in their having common property." (Politics, 1261b34)

Cicero held that there is no private property under natural law but only under human law.^[32] Seneca viewed property as only becoming necessary when men become avaricious.^[33] St. Ambrose later adopted this view and St. Augustine even derided heretics for complaining the Emperor could not confiscate property they had labored for.^[34]

The canon law Decretum Gratiani maintained that mere human law creates property, repeating the phrases used by St. Augustine.^[35] St. Thomas Aquinas agreed with regard to the private consumption of property but modified patristic theory in finding that the private possession of property is necessary.^[36] Thomas Aquinas concludes that, given certain detailed provisions,^[37]

• it is natural for man to possess external things
• it is lawful for a man to possess a thing as his own
• The essence of theft consists in taking another's thing secretly
• Theft and robbery are sins of different species, and robbery is a more grievous sin than theft
• theft is a sin; it is also a mortal sin
• it is, however, lawful to steal through stress of need:" in cases of need, all things are common property."

The principal writings of Thomas Hobbes appeared between 1640 and 1651—during and immediately following the war between forces loyal to King Charles I and those loyal to Parliament. In his own words, Hobbes' reflection began with the idea of "giving to every man his own," a phrase he drew from the writings of Cicero. But he wondered: How can anybody call anything his own?

A contemporary of Hobbes, James Harrington, reacted to the same tumult differently: he considered property natural but not inevitable. The author of "Oceana," he may have been the first political theorist to postulate that political power is a consequence, not the cause, of the distribution of property. He said that the worst possible situation is when the commoners have half a nation's property, with the crown and nobility holding the other half—a circumstance fraught with instability and violence. He suggested a much better situation (a stable republic) would exist once the commoners own most property.

In later years, the ranks of Harrington's admirers included American revolutionary and founder John Adams.

Another member of the Hobbes/Harrington generation, Sir Robert Filmer, reached conclusions much like Hobbes', but through Biblical exegesis. Filmer said that the institution of kingship is analogous to that of fatherhood, that subjects are still, children, whether obedient or unruly and that property rights are akin to the household goods that a father may dole out among his children—his to take back and dispose of according to his pleasure.

In the following generation, John Locke sought to answer Filmer, creating a rationale for a balanced constitution in which the monarch had a part to play, but not an overwhelming part. Since Filmer's views essentially require that the Stuart family be uniquely descended from the patriarchs of the Bible, and even in the late 17th century, that was a difficult view to uphold, Locke attacked Filmer's views in his First Treatise on Government, freeing him to set out his own views in the Second Treatise on Civil Government. Therein, Locke imagined a pre-social world each of the unhappy residents which are willing to create a social contract because otherwise, "the enjoyment of the property he has in this state is very unsafe, very insecure," and therefore, the "great and chief end, therefore, of men's uniting into commonwealths, and putting themselves under government, is the preservation of their property."^[38] They would, he allowed, create a monarchy, but its task would be to execute the will of an elected legislature. "To this end" (to achieve the previously specified goal), he wrote, "it is that men give up all their natural power to the society they enter into, and the community put the Legislative power into such hands as they think fit, with this trust, that they shall be governed by declared laws, or else their peace, quiet, and property will still be at the same uncertainty as it was in the state of nature."^[39]

Even when it keeps to proper legislative form, Locke held that there are limits to what a government established by such a contract might rightly do.

"It cannot be supposed that [the hypothetical contractors] they should intend, had they a power so to do, to give anyone or more an absolute arbitrary power over their persons and estates, and put a force into the magistrate's hand to execute his unlimited will arbitrarily upon them; this were to put themselves into a worse condition than the State of nature, wherein they had a liberty to defend their right against the injuries of others, and were upon equal terms of force to maintain it, whether invaded by a single man or many in combination. Whereas by supposing they have given themselves up to the absolute arbitrary power and will of a legislator, they have disarmed themselves, and armed him to make a prey of them when he pleases..."^[40]

Both "persons" and "estates" are to be protected from the arbitrary power of any magistrate, including legislative power and will." In Lockean terms, depredations against an estate are just as plausible a justification for resistance and revolution as are those against persons. In neither case are subjects required to allow themselves to become prey.

To explain the ownership of property, Locke advanced a labor theory of property.

In contrast to the figures discussed in this section thus far David Hume lived a relatively quiet life that had settled down to a relatively stable social and political structure. He lived the life of a solitary writer until 1763 when, at 52 years of age, he went off to Paris to work at the British embassy.

In contrast, one might think to his polemical works on religion and his empiricism-driven skeptical epistemology, Hume's views on law and property were quite conservative.

He did not believe in hypothetical contracts or the love of humanity in general and sought to ground politics upon actual human beings as one knows them. "In general," he wrote, "it may be affirmed that there is no such passion in the human mind, as the love of mankind, merely as such, independent of personal qualities, or services, or of relation to ourselves." Existing customs should not lightly be disregarded because they have come to be what they are due to human nature. With this endorsement of custom comes an endorsement of existing governments because he conceived of the two as complementary: "A regard for liberty, though a laudable passion, ought commonly to be subordinate to a reverence for established government."

Therefore, Hume's view was that there are property rights because of and to the extent that the existing law, supported by social customs, secure them.^[41] He offered some practical home-spun advice on the general subject, though, as when he referred to avarice as "the spur of industry," and expressed concern about excessive levels of taxation, which "destroy industry, by engendering despair."

"Civil government, so far as it is instituted for the security of property, is, in reality, instituted for the defense of the rich against the poor, or of those who have property against those who have none at all."

— Adam Smith, The Wealth of Nations, 1776^[42]

"The property that every man has in his labour is the original foundation of all other property, so it is the most sacred and inviolable. The inheritance of a poor man lies in the strength and dexterity of his hands, and to hinder him from employing this strength and dexterity in what manner he thinks proper without injury to his neighbor, is a plain violation of this most sacred property. It is a manifest encroachment upon the just liberty of the workman and those who might be disposed to employ him. It hinders the one from working at what he thinks proper, so it hinders the others from employing whom they think proper. To judge whether he is fit to be employed may surely be trusted to the discretion of the employers whose interest it so much concerns. The affected anxiety of the law-giver lest they should employ an improper person is as impertinent as it is oppressive." — (Source: Adam Smith, The Wealth of Nations, 1776, Book I, Chapter X, Part II.)

By the mid 19th century, the industrial revolution had transformed England and the United States and had begun in France. As a result, the conventional conception of what constitutes property expanded beyond land to encompass scarce goods. In France, the revolution of the 1790s had led to large-scale confiscation of land formerly owned by the church and king. The restoration of the monarchy led to claims by those dispossessed to have their former lands returned.

Section VIII, "Primitive Accumulation" of Capital involves a critique of Liberal Theories of property rights. Marx notes that under Feudal Law, peasants were legally entitled to their land as the aristocracy was to its manors. Marx cites several historical events in which large numbers of the peasantry were removed from their lands, then seized by the nobility. This seized land was then used for commercial ventures (sheep herding). Marx sees this "Primitive Accumulation" as integral to the creation of English Capitalism. This event created a sizeable un-landed class that had to work for wages to survive. Marx asserts that liberal theories of property are "idyllic" fairy tales that hide a violent historical process.

Charles Comte, in "Traité de la propriété" (1834), attempted to justify the legitimacy of private property in response to the Bourbon Restoration. According to David Hart, Comte had three main points: "firstly, that interference by the state over the centuries in property ownership has had dire consequences for justice as well as for economic productivity; secondly, that property is legitimate when it emerges in such a way as not to harm anyone; and thirdly, that historically some, but by no means all, property which has evolved has done so legitimately, with the implication that the present distribution of property is a complex mixture of legitimately and illegitimately held titles."^[43]

Comte, as Proudhon later did, rejected Roman legal tradition with its toleration of slavery. Instead, he posited a communal "national" property consisting of non-scarce goods, such as land in ancient hunter-gatherer societies. Since agriculture was so much more efficient than hunting and gathering, private property appropriated by someone for farming left remaining hunter-gatherers with more land per person and hence did not harm them. Thus this type of land appropriation did not violate the Lockean proviso – there was "still enough, and as good left." Later theorists would use Comte's analysis in response to the socialist critique of property.

In his 1840 treatise What is Property?, Pierre Proudhon answers with "Property is theft!". In natural resources, he sees two types of property, de jure property (legal title) and de facto property (physical possession), and argues that the former is illegitimate. Proudhon's conclusion is that "property, to be just and possible, must necessarily have equality for its condition."

His analysis of the product of labor upon natural resources as property (usufruct) is more nuanced. He asserts that land itself cannot be property, yet it should be held by individual possessors as stewards of humanity, with the product of labor being the producer's property. Proudhon reasoned that any wealth gained without labor was stolen from those who labored to create that wealth. Even a voluntary contract to surrender the product of work to an employer was theft, according to Proudhon, since the controller of natural resources had no moral right to charge others for the use of that which he did not labor to create did not own.

Proudhon's theory of property greatly influenced the budding socialist movement, inspiring anarchist theorists such as Mikhail Bakunin who modified Proudhon's ideas, as well as antagonizing theorists like Karl Marx.

Frédéric Bastiat 's main treatise on property can be found in chapter 8 of his book "Economic Harmonies" (1850).^[44] In a radical departure from traditional property theory, he defines property, not as a physical object, but rather as a relationship between people concerning a thing. Thus, saying one owns a glass of water is merely verbal shorthand for "I may justly gift or trade this water to another person." In essence, what one owns is not the object but the object's value. By "value," Bastiat means "market value"; he emphasizes this is quite different from utility. "In our relations with one another, we are not owners of the utility of things, but their value, and value is the appraisal made of reciprocal services."

Bastiat theorized that, as a result of technological progress and the division of labor, the stock of communal wealth increases over time; that the hours of work an unskilled laborer expends to buy e.g., 100 liters of wheat, decreases over time, thus amounting to "gratis" satisfaction.^[45] Thus, private property continually destroys itself, becoming transformed into communal wealth. The increasing proportion of communal wealth to private property results in a tendency toward equality of humanity. "Since the human race began in greatest poverty, that is, when there were the most obstacles to overcome, all that has been achieved from one era to the next is due to the spirit of property."

This transformation of private property into the communal domain, Bastiat points out, does not imply that personal property will ever totally disappear. On the contrary, this is because man, as he progresses, continually invents new and more sophisticated needs and desires.

Andrew J. Galambos (1924–1997) was an astrophysicist and philosopher who innovated a social structure that sought to maximize human peace and freedom. Galambos' concept of property was essential to his philosophy. He defined property as a man's life and all non-procreative derivatives of his life. (Because the English language is deficient in omitting the feminine from "man" when referring to humankind, it is implicit and obligatory that the feminine is included in the term "man.")

Galambos taught that property is essential to a non-coercive social structure. He defined freedom as follows: "Freedom is the societal condition that exists when every individual has full (100%) control over his property."^[46] Galambos defines property as having the following elements:

• Primordial property, which is an individual's life
• Primary property, which includes ideas, thoughts, and actions
• Secondary property includes all tangible and intangible possessions that are derivatives of the individual's primary property.

Property includes all non-procreative derivatives of an individual's life; this means children are not the property of their parents.^[47] and "primary property" (a person's own ideas).^[48]

Galambos repeatedly emphasized that actual government exists to protect property and that the State attacks property. For example, the State requires payment for its services in the form of taxes whether or not people desire such services. Since an individual's money is his property, the confiscation of money in the form of taxes is an attack on property. Military conscription is likewise an attack on a person's primordial property.

Contemporary political thinkers who believe that natural persons enjoy rights to own property and enter into contracts espouse two views about John Locke. On the one hand, some admire Locke, such as William H. Hutt (1956), who praised Locke for laying down the "quintessence of individualism." On the other hand, those such as Richard Pipes regard Locke's arguments as weak and think that undue reliance thereon has weakened the cause of individualism in recent times. Pipes has written that Locke's work "marked a regression because it rested on the concept of Natural Law" rather than upon Harrington's sociological framework.

Hernando de Soto has argued that an essential characteristic of the capitalist market economy is the functioning state protection of property rights in a formal property system which records ownership and transactions. These property rights and the whole legal system of property make possible:

• Greater independence for individuals from local community arrangements to protect their assets
• Clear, provable, and protectable ownership
• The standardization and integration of property rules and property information in a country as a whole
• Increased trust arising from a greater certainty of punishment for cheating in economic transactions
• More formal and complex written statements of ownership that permit the more straightforward assumption of shared risk and ownership in companies, and insurance against the risk
• Greater availability of loans for new projects since more things can serve as collateral for the loans
• Easier access to and more reliable information regarding such things as credit history and the worth of assets
• Increased fungibility, standardization, and transferability of statements documenting the ownership of property, which paves the way for structures such as national markets for companies and the easy transportation of property through complex networks of individuals and other entities
• Greater protection of biodiversity due to minimizing of shifting agriculture practices

According to de Soto, all of the above enhance economic growth.^[49] Academics have criticized the capitalist frame through which property is viewed pointing to the fact that commodifying property or land by assigning it monetary value takes away from the traditional cultural heritage, particularly from first nation inhabitants.^[50][51] These academics point to the personal nature of property and its link to identity being irreconcilable with wealth creation that contemporary Western society subscribes to.^[50]

Property-giving (legal)

Property-taking (legal)

Property-taking (illegal)

• Theft

• Bastiat, Frédéric, 1850. Economic Harmonies. W. Hayden Boyers.
• Bastiat, Frédéric, 1850. "The Law", tr. Dean Russell.
• Bethell, Tom, 1998. "The Noblest Triumph: Property and Prosperity through the Ages." New York: St. Martin's Press.
• Blackstone, William, 1765–69. "Commentaries on the Laws of England", 4 vols. Oxford Univ. Press. Especially Books the Second and Third.
• De Soto, Hernando, 1989. "The Other Path". Harper & Row.
• De Soto, Hernando, and Francis Cheneval, 2006. Realizing Property Rights. Ruffer & Rub.
• Ellickson, Robert, 1993. ""Property in Land" (PDF). Archived from the original (PDF) on 2008-04-09. (6.40 MB)", Yale Law Journal 102: 1315–1400.
• Mckay, John P., 2004, "A History of World Societies". Boston: Houghton Mifflin Company
• Palda, Filip (2011) "Pareto's Republic and the New Science of Peace" 2011 [1] chapters online. Published by Cooper-Wolfling. ISBN 978-0-9877880-0-9
• Pipes, Richard, 1999. "Property and Freedom". New York: Knopf Doubleday. ISBN 978-0-375-40498-6

Wikiquote has quotations related to Property.

• Concepts of Property, Hugh Breakey, Internet Encyclopedia of Philosophy
• "Right to Private Property", Tibor Machan, Internet Encyclopedia of Philosophy
• Friedmann, Wolfgang (1974). "Property". In Wiener, Philip P. (ed.). Dictionary of the History of Ideas: Studies of Selected Pivotal Ideas. Vol. 3 (University of Virginia, Electronic Text Center ed.). New York: Scribners. pp. 650–657.
• "Property and Ownership" Jeremy Waldron, The Stanford Encyclopedia of Philosophy (Winter 2016 Edition), Edward N. Zalta (ed.).

Subset of land that has been legally defined and the improvements to it made by human efforts

 

For the legal concept, see Real property. For other uses, see Real Estate (disambiguation).

The examples and perspective in this article may not represent a worldwide view of the subject. You may improve this article, discuss the issue on the talk page, or create a new article, as appropriate. (March 2023) (Learn how and when to remove this message)

• v
• t
• e

Property law
Part of the common law series
Types
Personal property Community property Real property Unowned property
Acquisition
Gift Adverse possession Deed Conquest Discovery Accession Lost, mislaid, and abandoned property Treasure trove Bailment License Alienation
Estates in land
Allodial title Fee simple Fee tail Life estate Defeasible estate Future interest remainder Concurrent estate Leasehold estate Condominiums Real estate Land tenure
Conveyancing
Bona fide purchaser Torrens title Strata title Deeds registration Estoppel by deed Quitclaim deed Mortgage Equitable conversion Action to quiet title Escheat
Future use control
Restraint on alienation Rule against perpetuities Rule in Shelley's Case Doctrine of worthier title
Nonpossessory interest
Lien Easement Profit Usufruct Covenant Equitable servitude
Related topics
Fixtures Waste Partition Practicing without a license Property rights Mineral rights Water rights prior appropriation riparian Lateral and subjacent support Assignment Nemo dat Quicquid plantatur Conflict of property laws Blackacre Security deposit
Other common law areas
Contract law Tort law Wills, trusts and estates Criminal law Evidence Higher category: Law and Common law

Real estate is property consisting of land and the buildings on it, along with its natural resources such as growing crops (e.g. timber), minerals or water, and wild animals; immovable property of this nature; an interest vested in this (also) an item of real property, (more generally) buildings or housing in general.^[1][2] In terms of law, real relates to land property and is different from personal property, while estate means the "interest" a person has in that land property.^[3]

Real estate is different from personal property, which is not permanently attached to the land (or comes with the land), such as vehicles, boats, jewelry, furniture, tools, and the rolling stock of a farm and farm animals.

In the United States, the transfer, owning, or acquisition of real estate can be through business corporations, individuals, nonprofit corporations, fiduciaries, or any legal entity as seen within the law of each U.S. state.^[3]

History of real estate

[edit]

The natural right of a person to own property as a concept can be seen as having roots in Roman law as well as Greek philosophy.^[4] The profession of appraisal can be seen as beginning in England during the 1500s, as agricultural needs required land clearing and land preparation. Textbooks on the subject of surveying began to be written and the term "surveying" was used in England, while the term "appraising" was more used in North America.^[5] Natural law which can be seen as "universal law" was discussed among writers of the 15th and 16th century as it pertained to "property theory" and the inter-state relations dealing with foreign investments and the protection of citizens private property abroad. Natural law can be seen as having an influence in Emerich de Vattel's 1758 treatise The Law of Nations which conceptualized the idea of private property.^[6]

One of the largest initial real estate deals in history known as the "Louisiana Purchase" happened in 1803 when the Louisiana Purchase Treaty was signed. This treaty paved the way for western expansion and made the U.S. the owners of the "Louisiana Territory" as the land was bought from France for fifteen million dollars, making each acre roughly 4 cents.^[7] The oldest real estate brokerage firm was established in 1855 in Chicago, Illinois, and was initially known as "L. D. Olmsted & Co." but is now known as "Baird & Warner".^[8] In 1908, the National Association of Realtors was founded in Chicago and in 1916, the name was changed to the National Association of Real Estate Boards and this was also when the term "realtor" was coined to identify real estate professionals.^[9]

The stock market crash of 1929 and the Great Depression in the U.S. caused a major drop in real estate worth and prices and ultimately resulted in depreciation of 50% for the four years after 1929.^[10] Housing financing in the U.S. was greatly affected by the Banking Act of 1933 and the National Housing Act in 1934 because it allowed for mortgage insurance for home buyers and this system was implemented by the Federal Deposit Insurance as well as the Federal Housing Administration.^[11] In 1938, an amendment was made to the National Housing Act and Fannie Mae, a government agency, was established to serve as a secondary market for mortgages and to give lenders more money in order for new homes to be funded.^[12]

Title VIII of the Civil Rights Act in the U.S., which is also known as the Fair Housing Act, was put into place in 1968 and dealt with the incorporation of African Americans into neighborhoods as the issues of discrimination were analyzed with the renting, buying, and financing of homes.^[13] Internet real estate as a concept began with the first appearance of real estate platforms on the World Wide Web (www) and occurred in 1999.

Residential real estate

[edit]

Residential real estate may contain either a single family or multifamily structure that is available for occupation or for non-business purposes.^[14]

Residences can be classified by and how they are connected to neighbouring residences and land. Different types of housing tenure can be used for the same physical type. For example, connected residences might be owned by a single entity and leased out, or owned separately with an agreement covering the relationship between units and common areas and concerns.^[15]

According to the Congressional Research Service, in 2021, 65% of homes in the U.S. are owned by the occupier.^[16]

Major categories

• Attached / multi-unit dwellings
  • Apartment (American English) or Flat (British English) – An individual unit in a multi-unit building. The boundaries of the apartment are generally defined by a perimeter of locked or lockable doors. Often seen in multi-story apartment buildings.
  • Multi-family house – Often seen in multi-story detached buildings, where each floor is a separate apartment or unit.
  • Terraced house (a.k.a. townhouse or rowhouse) – A number of single or multi-unit buildings in a continuous row with shared walls and no intervening space.
  • Condominium (American English) – A building or complex, similar to apartments, owned by individuals. Common grounds and common areas within the complex are owned and shared jointly. In North America, there are townhouse or rowhouse style condominiums as well. The British equivalent is a block of flats.
  • Housing cooperative (a.k.a. co-op) – A type of multiple ownership in which the residents of a multi-unit housing complex own shares in the cooperative corporation that owns the property, giving each resident the right to occupy a specific apartment or unit. Majority of housing in Indian metro cities are of these types.
  • Tenement – A type of building shared by multiple dwellings, typically with flats or apartments on each floor and with shared entrance stairway access found in Britain.
• Semi-detached dwellings
  • Duplex – Two units with one shared wall.
• Detached dwellings
  • Bungalows
  • Split-level home
  • Mansions
  • Villas
  • Detached house or single-family detached house
  • Cottages
• Portable dwellings
  • Mobile homes, tiny homes, or residential caravans – A full-time residence that can be (although might not in practice be) movable on wheels.
  • Houseboats – A floating home
  • Tents – Usually temporary, with roof and walls consisting only of fabric-like material.

Other categories

• Chawls
• Havelis
• Igloos
• Huts

The size of havelis and chawls is measured in Gaz (square yards), Quila, Marla, Beegha, and acre.

See List of house types for a complete listing of housing types and layouts, real estate trends for shifts in the market, and house or home for more general information.

Real estate and the environment

[edit]

Real estate can be valued or devalued based on the amount of environmental degradation that has occurred. Environmental degradation can cause extreme health and safety risks. There is a growing demand for the use of site assessments (ESAs) when valuing a property for both private and commercial real estate.^[17]

Environmental surveying is made possible by environmental surveyors who examine the environmental factors present within the development of real estate as well as the impacts that development and real estate has on the environment.

Green development is a concept that has grown since the 1970s with the environmental movement and the World Commission on Environment and Development. Green development examines social and environmental impacts with real estate and building. There are 3 areas of focus, being the environmental responsiveness, resource efficiency, and the sensitivity of cultural and societal aspects. Examples of Green development are green infrastructure, LEED, conservation development, and sustainability developments.

Real estate in itself has been measured as a contributing factor to the rise in green house gases. According to the International Energy Agency, real estate in 2019 was responsible for 39 percent of total emissions worldwide and 11 percent of those emissions were due to the manufacturing of materials used in buildings.^[18]

Development

[edit]

Part of a series on
Living spaces
Main House: detached semi-detached terraced Apartment Bungalow Cottage Ecohouse Green home Housing project Human outpost I-house Ranch Tenement Condominium Mixed-use development Hotel Hostel Castle Public housing Squat Flophouse Shack Slum Shanty town Villa
Issues Affordability (in the United States) Executive housing Environmental: design planning racism Environmental security Eviction Fair housing Healthiness Homelessness Housing crisis Housing discrimination Housing stress Overpopulation Housing inequality Home ownership Luxury apartments Ownership equity Permit Rent Subprime lending Subsidized housing Sustainable: architecture development living Sustainable city Toxic hotspot Vagrancy
Society and politics Housing First Housing subsidy Impact fee NIMBY Rapid Re-Housing Real estate appraisal Real estate bubble Real estate economics Real estate investing Redlining Rent regulation Right to housing Rent control Rent strike Tenants union YIMBY
Other Alternative lifestyle Assisted living Boomtown Cottage homes Eco-cities Ecovillage Foster care Green building Group home Halfway house Healthy community design Homeless shelter Hospital Local community Log house Natural building Nursing home Orphanage Prison Psychiatric hospital Residential care Residential treatment center Retirement community Retirement home Supportive housing Supported living   Housing portal

• 
  Property for sale in Victoria, Australia: sign. (left)
• 
  The property in Victoria after it was sold as stated on sign

Real estate development involves planning and coordinating of housebuilding, real estate construction or renovation projects.^[19] Real estate development can be less cyclical than real estate investing.^[20]

In markets where land and building prices are rising, real estate is often purchased as an investment, whether or not the owner intends to use the property. Often investment properties are rented out, but "flipping" involves quickly reselling a property, sometimes taking advantage of arbitrage or quickly rising value, and sometimes after repairs are made that substantially raise the value of the property. Luxury real estate is sometimes used as a way to store value, especially by wealthy foreigners, without any particular attempt to rent it out. Some luxury units in London and New York City have been used as a way for corrupt foreign government officials and business people from countries without strong rule of law to launder money or to protect it from seizure.^[21] Investment in real estate can be categorized by financial risk into core, value-added, and opportunistic.^[22]

• Real estate agent – North America
• Estate agent – United Kingdom

• The dictionary definition of real estate at Wiktionary
• Quotations related to Real estate at Wikiquote

In economics, cash is money in the physical form of currency, such as banknotes and coins.

In bookkeeping and financial accounting, cash is current assets comprising currency or currency equivalents that can be accessed immediately or near-immediately (as in the case of money market accounts). Cash is seen either as a reserve for payments, in case of a structural or incidental negative cash flow or as a way to avoid a downturn on financial markets.

The English word cash originally meant 'money box', and later came to have a secondary meaning 'money'. This secondary usage became the sole meaning in the 18th century. The word cash comes from the Middle French caisse 'money box', which comes from the Old Italian cassa, and ultimately from the Latin capsa 'box'.^[1][2]

Part of a series on
Accounting
Constant purchasing power Historical cost Management Tax
Major types Audit Budget Cost Forensic Financial Fund Governmental Management Social Tax
Key concepts Accounting period Accrual Constant purchasing power Economic entity Fair value Going concern Historical cost Matching principle Materiality Revenue recognition Unit of account
Selected accounts Assets Cash Cost of goods sold Depreciation / Amortization (business) Equity Expenses Goodwill Liabilities Profit Revenue
Accounting standards Generally-accepted principles Generally-accepted auditing standards Convergence International Financial Reporting Standards International Standards on Auditing Management Accounting Principles
Financial statements Annual report Balance sheet Cash-flow Equity Income Management discussion Notes to the financial statements
Bookkeeping Bank reconciliation Debits and credits Double-entry system FIFO and LIFO Journal Ledger / General ledger Trial balance
Auditing Financial Internal Firms Report Sarbanes–Oxley Act
People and organizations Accountants Accounting organizations Luca Pacioli
Development History Research Positive accounting Sarbanes–Oxley Act
Misconduct Creative Earnings management Error account Hollywood Off-balance-sheet Two sets of books

In Western Europe, after the fall of the Western Roman Empire, coins, silver jewelry and hacksilver (silver objects hacked into pieces) were for centuries the only form of money, until Venetian merchants started using silver bars for large transactions in the early Middle Ages. In a separate development, Venetian merchants started using paper bills, instructing their banker to make payments. Similar marked silver bars were in use in lands where the Venetian merchants had established representative offices. The Byzantine Empire and several states in the Balkan area and Kievan Rus also used marked silver bars for large payments. As the world economy developed and silver supplies increased, in particular after the colonization of South America, coins became larger and a standard coin for international payment developed from the 15th century: the Spanish and Spanish colonial coin of 8 reales. Its counterpart in gold was the Venetian ducat.

Coin types would compete for markets. By conquering foreign markets, the issuing rulers would enjoy extra income from seigniorage (the difference between the value of the coin and the value of the metal the coin was made of). Successful coin types of high nobility would be copied by lower nobility for seigniorage. Imitations were usually of a lower weight, undermining the popularity of the original. As feudal states coalesced into kingdoms, imitation of silver types abated, but gold coins, in particular, the gold ducat and the gold florin were still issued as trade coins: coins without a fixed value, going by weight. Colonial powers also sought to take away market share from Spain by issuing trade coin equivalents of silver Spanish coins, without much success.

In the early part of the 17th century, English East India Company coins were minted in England and shipped to the East. In England, over time the word cash was adopted from Sanskrit कर्ष karsa,^{[dubious – discuss]} a weight of gold or silver but akin to the Old Persian 𐎣𐎼𐏁 karsha, unit of weight (83.30 grams). East India Company coinage had both Urdu and English writing on it, to facilitate its use within the trade. In 1671, the directors of the East India Company ordered a mint to be established at Bombay, known as Bombaim. In 1677 this was sanctioned by the Crown, the coins, having received royal sanction, were struck as silver rupees; the inscription runs "The rupee of Bombaim", by the authority of Charles II.

Around that time, coins were also being produced for the East India Company at the Madras mint. The Tamil the word for money is kaasu,^[3] which may have been modified into 'cash'. Both words, 'kaasu' and 'cash', have the same meaning, unlike money box. The currency at the company's Bombay and Bengal administrative regions was the rupee. At Madras, however, the company's accounts were reckoned in pagodas, fractions, fanams, faluce and cash. This system was maintained until 1818 when the rupee was adopted as the unit of currency for the company's operations.

Paper money was first used in China during the Tang dynasty 500 years prior to it catching on in Europe.^[4] During his visit to China in the 13th century, Marco Polo was amazed to find that people traded paper money for goods rather than valuable coins made of silver or gold. He wrote extensively about how the Great Kaan used a part of the Mulberry Tree to create the paper money as well as the process with which a seal was used to impress on the paper to authenticate it. Marco Polo also talks about the chance of forgery and states that someone caught forging money would be punished with death.^[5] In the 17th century, European countries started to use paper money in part due to a shortage of precious metals, leading to fewer coins being produced and put into circulation.^[6] At first, it was most popular in the colonies of European powers. In the 18th century, important paper issues were made in colonies such as Ceylon and the bordering colonies of Essequibo, Demerara and Berbice. John Law did pioneering work on banknotes with the Banque Royale. The relation between money supply and inflation was still imperfectly understood and the bank went under rendering its notes worthless, because they had been over-issued. The lessons learned were applied to the Bank of England, which played a crucial role in financing the Peninsular War against French troops, hamstrung by a metallic Franc de Germinal.

The ability to create paper money made nation-states responsible for the management of inflation, through control of the money supply. It also made a direct relation between the metal of the coin and its denomination superfluous. From 1816, coins generally became token money, though some large silver and gold coins remained standard coins until 1927.^{[citation needed]} The World War I saw standard coins disappear to a very large extent. Afterward, standard gold coins, mainly British sovereigns, would still be used in colonies and less developed economies and silver Maria Theresa thalers dated 1780 would be struck as trade coins for countries in East Asia until 1946 and possibly later locally.

Cash has now become a very small part of the money supply. Its remaining role is to provide a form of currency storage and payment for those who do not wish to take part in other systems, and make small payments conveniently and promptly, though this latter role is being replaced more and more frequently by electronic payment systems. Research has found that the demand for cash decreases as debit card usage increases because merchants need to make less change for customer purchases.^[7]

Cash is increasing in circulation. The amount of the United States dollar in circulation increased by 42% from 2007 to 2012.^[8] The amount of pound sterling banknotes in circulation increased by 29% from 2008 to 2013.^[9] The amount of euro in circulation increased by 34% from August 2008 to August 2013 (2% of the increase was due to the adoption of euro in Slovakia 2009 and in Estonia 2011).^[10]

In economic theory (according Keynesian economics), the cash holding of cash (especially sight deposits) is roughly attributed to three motives:^[11]

• Transactions motive
• Precautionary motive
• Speculative motive.

The transactions motive covers the business needs of economic subjects, the precautionary motive serves to hold money for liquidity purposes and to provide for crisis situations,^[12] and the speculation motive, according to John Maynard Keynes, results from the uncertainty about future interest rate developments and relates to financial investments.

In addition to this purely economic importance, there are other aspects of cash use:^[13][14][15]

• Anonymous payment without disclosing personal data
• Trust to the central bank (control and publication of money creation)
• Activation of a reward center in the brain (anticipation of reaching a specific goal)
• Expenditure control (immediate physical payment)
• Tradition (haptic experience, e.g. monetary donation; long-term reliability of value retention)
• Inclusion (equal participation in economic life for all)
• Identification (symbolic character, solidarity and group membership)
• Educational tool for children (objective handling of assets and expenses)
• Paying a tip as immediate recognition of good service.

In practice, there may be a combination of such motives, with the precautionary motive of preserving value and anonymous payment being decisive. Due to its unique characteristics, there is no perfect substitute for cash. Demonetisation or capital control can destabilize the economy if electronic means of payment are not readily available (e.g. 2016 Indian banknote demonetisation).^[15]

Cash in circulation is characterized by strong seasonal fluctuations. Wage and salary payment dates, tax payment dates or holidays lead to statistically perceptible increases in cash in circulation, for which the credit institutions are preparing. Since cash holdings at banks do not earn interest and can also lead to security problems (bank robbery), banks usually only hold very small amounts of cash. They are therefore forced to involve the central bank in times of higher cash requirements. Therefore, the cash in circulation only remains unchanged if the banks hand over cash from their own cash holdings to their bank customers or take cash deposits from their customers into their own holdings.

The ratio of the cash in circulation in relation to the gross domestic product (cash to GDP ratio) is a good indicator of cash usage and payment behavior in an economy. In countries like the United States, increased use of debit and credit cards is increasing the amount of cash in circulation at a slower rate than in countries with a high amount of cash payments. In 2018, it ranged from 1.3% (in Sweden) to more than 21% (in Japan), 10.5% in Switzerland and 10.7% in the eurozone.^[16]

Since around 2018, exacerbated by the COVID-19 pandemic, cash in circulation in the eurozone has increased significantly while the share of cash payments (i.e. transactions) has decreased, known as the paradox of banknotes. Analyzes show that private households are increasingly keeping cash as a precaution against crises and that negative interest rates also play a role.^[17] This effect is also observed in many other currency areas, e.g. in the United States and Japan.^[18]

In most jurisdictions, banknotes are not routinely tracked by serial number. There are the following exceptions in cash applications:

• Registration of ransom money for blackmail (e.g. for the Oetker kidnapping^[19])
• Macroeconomic studies of cash flows through the central bank^[20]
• Statistical recording of the lifespan of banknotes by the central bank^[21]
• Tracking the (location-based) migration of individual banknotes using EuroBillTracker for euro banknotes, Where's George? for US dollars and Where's Willy? for Canadian dollars as a hobby
• Use of individual banknotes for sharing messages with recipients using the mobile app smill.^[22]

Since 2016, the People's Bank of China has requested the recording of banknotes issued and deposited at ATMs and bank counters, arguing that counterfeit money will be prosecuted.^[23]

With Directive ECB/2010/14, the European Central Bank (ECB) requires banks to check the authenticity of deposited and withdrawn banknotes at bank counters and ATMs using tested devices. They are required to trace the origin of suspected counterfeit banknotes to the depositing account holder. They must also physically seize any counterfeit notes and coins.^[24]

Cashless society can be defined as one in which all financial transactions are handled through "digital" forms (debit and credit cards) in preference to cash (physical banknotes and coins). Cashless societies have been a part of history from the very beginning of human existence. Barter and other methods of exchange were used to conduct a wide variety of trade transactions during this time period.^[25]

Since the 1980s, the use of banknotes has increasingly been displaced by credit and debit cards, electronic money transfers and mobile payments, but much slower than expected. The cashless society has been predicted for more than forty years,^[26] but cash remains the most widely used payment instrument in the world and on all continents.^{[27]: 14â€ÅÂÂÂÂÂÂ}  In 17 out of 24 studied countries, cash represents more than 50% of all payment transactions, with Austria at 85%, Germany at 80%, France at 68%. The United Kingdom at 42%, Australia at 37%, United States at 32%, Sweden at 20%, and South Korea at 14% are among the countries with lower cash usage.^{[27]: 27â€ÅÂÂÂÂÂÂ} 

By the 2010s, cash was no longer the preferred method of payment in the United States.^[28] In 2016, the United States User Consumer Survey Study reported that three out of four of the participants preferred a debit or credit card payment instead of cash.^[29] Some nations have contributed to this trend, by regulating what type of transactions can be conducted with cash and setting limits on the amount of cash that can be used in a single transaction.^[30]

Cash is still the primary means of payment (and store of value) for unbanked people with a low income and helps avoiding debt traps due to uncontrolled spending of money. It supports anonymity and avoids tracking for economic or political reasons.^[31] In addition, cash is the only means for contingency planning in order to mitigate risks in case of natural disasters or failures of the technical infrastructure like a large-scale power blackout or shutdown of the communication network.^[32] Therefore, central banks and governments are increasingly driving the sufficient availability of cash. The US Federal Reserve has provided guidelines for the continuity of cash services,^[33] and the Swedish government is concerned about the consequences in abandoning cash and is considering to pass a law requiring all banks to handle cash.^[34]

Digital currency is a generic term for various approaches to support secure transactions of the public or using a distributed ledger, like blockchain, as a new technology for decentralized asset management. The blockchain 1.0 era has enabled the application of virtual digital currencies in the marketplace, such as money transfer and payment systems.^[35] It considers establishing an electronic version of the national currency which is backed by the central bank as the issuer. Virtual currency is a digital representation of value that is neither issued by a central bank or a public authority, such as Bitcoin.^[36] Facebook's concept for the diem is based on a token to be backed by financial assets such as a basket of national currencies.

In 2012, Bank of Canada was considering introducing digital currency.^[37][38] Meanwhile, it rates digital currency a fairly complicated decision and is analyzing the pros and cons and working to determine under which conditions it may make sense to, one day, issue a digital currency. As a threat, a central bank digital currency could increase the risk of a run on the banking system.^[39]

Also in 2012, Sveriges Riksbank, the central bank of Sweden, was reported to analyze technological advances with regard to electronic money and payment methods for digital currency as an alternative to cash.^[40] In 2019, it is investigating whether Swedish krona need to be made available in electronic form, the so-called e-krona, and if so, how it would affect Swedish legislation and the Riksbank's task. It has started procuring a technical supplier to develop and test solutions for a potential future e-krona. No decisions have yet been taken on issuing an e-krona.^[41]

An analysis by the Deutsche Bundesbank in 2017 found that a cash payment in retail costs an average of 24 euro cents, while payments with a girocard cost 30 cents (or often 0.3 to 0.4% of sales plus a transaction fee) and with a credit card charge one euro which is included in the sales price.^[42] This is why retailers often refuse to accept card payments below a minimum amount. Depending on the account model, there are also booking costs for the account holder with an average of 35 euro cents charged for each(!) account posting. Because of this convenient source of income, commercial banks and credit card companies favor cashless payments.

In the case of cashless payment transactions, in addition to the documentation of the payment itself, the personal details of the payer are usually linked to the data of the payee according to the Know Your Customer (KYC) principle. This enables the payment process to be precisely traced for the payer and the payee. The constant increase in digitization leads to a more detailed recording of cashless payment transactions and their evaluation for advertising and marketing campaigns. Since this digital documentation is usually more centralized than before, the potential for abuse increases. On the other hand, the cash transactions are anonymous, unless purchasing profiles are recorded with the help of loyalty programs based on customer cards, and keep the payment landscape competitive.^[43]

In August 2023, Chancellor of Austria Karl Nehammer came out in support for enshrining cash in the Austrian constitution. This came after the Freedom Party of Austria campaigned on the idea.^[44]

In 2023, The Swiss government supported moves to have a constitutional protection for cash. This came after a popular initiative asked for it.^[45]

In June 2023, the Slovakian parliament voted with the support of 111 of 150 MPs to put the right to use cash in the Constitution of Slovakia. The amendment was proposed by the Sme Rodina party.^[46]

• Davies, G. (1994). A History of Money From Ancient Times to the Present Day. Cardiff: University of Wales Press. ISBN 9780708313510.
• Spufford, P. (2008). How Rarely Did Medieval Merchants Use Coin?. Utrecht: Stichting Nederlandse Penningkabinetten. ISBN 9789073882218.