Choosing Your Government Service Provider

Tyler Cowen linked to an interesting Middle East peace proposal:

An even more radical idea has been put forward by Swedish diplomat Mathias Mossberg and UC-Irvine professor Mark LeVine. They do not believe giving settlers Palestinian passports would solve anything. The two propose creating overlapping states between the Jordan River and Mediterranean Sea, delinking the concept of state sovereignty from a specific territory. There would be an Israel and a Palestine, but rather than divide the land, the two states would be superimposed on top of one another. The plan would permit individuals to live where they wish and choose their political allegiance. This, they argue, would resolve the seemingly intractable questions of how to divide the holy city of Jerusalem and whether to allow Palestinian refugees “the right of return” to their old communities.

Tyler thinks this polycentric order will deteriorate for lack of any credible means of resolving disputes. For any law firm or arbitrator specializing in adjudicating these conflicts, it’d be a tough market to enter. Prejudice, bias, culture and a history of vengance–it’s hard to see how an arbitrator could build trust on this foundation.

On a related note about overlapping jurisdictions in general, Arnold Kling writes:

The key, I think, is to transfer people’s emotional attachment from their government to something else, like a religious sect, ethnic identity, or a sports team. You can have Yankee fans and Red Sox fans living next door to one another without infringing on each others’ rights. It’s when people give their emotional loyalty to government that you get friction.

For all sorts of reasons, it’s very difficult to disentangle this emotional attachment, particularly when a perceived moral authority is tied to specific territory. To separate church and state, it took a bloody century or two of reformation and counter-reformation in Europe, plus a mass migration of persecuted sects to North America. Still, despite these difficulties, freedom of religion was established. We now take it for granted that the moral authority of religion is non-territorial. It took a little rule innovation by William Penn to get there, but the upshot is a workable polycentric religious order. By analogy, I think a feasible polycentric legal order will only emerge in a market for governance. People who migrate to a new place are much more likely to accept the rules of their destination than stationary folk who have long labored under the tired old ways.