The Pilgrims struggling to survive at Plymouth Plantation learned the importance of private property first-hand in 1623 when Governor Bradford adopted a free-enterprise system after just two years of communal sharing. Their experiment with socialism revealed valuable lessons that inspired the colony to shift to a free-market economic system that would serve as the foundation upon which America would grow into a great and prosperous nation.
As the Pilgrims learned, societies that respect property and the rule of law capture the benefits of free-market enterprise and enjoy high levels of prosperity. The benefit that we see from free markets is contingent on individuals having the right to own and protect property and to benefit from their labor.
“The settlers now began to consider corn more precious than silver” – Governor William Bradford
Plymouth Plantation was an experiment. Disgruntled members of the Old World left behind oppressive governments in search of a New World – both in terms of land as well as social, political and economic systems. The Pilgrims arrived at what would become the Plymouth Plantation in the late fall of 1620 and immediately implemented a communal labor system for the colony.
Governor Bradford, along with other leaders, believed that this system was the most efficient and fair distribution of resources. Each member of the colony would farm a plot of land and give all of his harvest to the common storehouse where it would then be redistributed as needed.
But this strategy was a disaster, resulting in food shortages and widespread hunger. In fact, just 50 of the 102 original settlers survived past the first winter in 1620 due to hunger and disease. Because each member of the community received a set amount of grain regardless of what he produced—the system distorted the incentives for individuals to make the sacrifice of working for the material support of their fellow human beings.
Hunger was pervasive as many members of the community shirked their duty and did not produce enough food for everyone, relying on others to provide the food that would then be divided equally. Furthermore, men resented the obligation to support other men’s families. As the situation worsened, stealing from the communal storehouse became widespread since the storehouse was not actually owned by anyone.
Solution? Give them land!
Recognizing the failure of the communal system, Governor Bradford implemented private property rights, giving individuals an incentive to produce as much food as possible. Each individual or family in the colony was given a plot of land to farm and was permitted to enjoy all the products of their labor. The results of allowing for individual production and trade as a foundation to economic freedom were staggering. Within two years, the colony was producing so much food that members began trading their surplus with other community members and with the nearby Wampanoag tribe, expanding access to different kinds of goods. With more food and comforts, the colony’s population grew and geographically expanded.
The experience at Plymouth Plantation illustrates the significance of property rights for economic growth and prosperity. The Pilgrims taught us that human beings are motivated to work and produce when they are allowed to benefit from their labor. The United States grew to become one of the most prosperous nations in the world thanks, in part, to the lessons learned at the tiny Massachusetts colony in the early 17th century. The experience serves as a powerful reminder that economic freedom and the protection of property rights upon which it rests lead to flourishing and prosperous societies.
A version of this blog originally appeared on EconomicFreedom.org, a project of the Charles Koch Institute. The Institute republished it here on July 31, 2015.