Of late I’ve begun to realize how amazingly insightful David Hume was on several important issues:

• Hume recognized the importance of scarcity in the definition of what property is. Austro-libertarian political philosopher Hans-Hermann Hoppe relies heavily on this aspect of property in chs. 1-2 of A Theory of Socialism and Capitalism, far more explicitly than previous political theorists. Even Rothbard and Mises did not focus as intensely on this crucial issue. (See my post Hume on Intellectual Property and the Problematic “Labor” Metaphor.)¹
• Hume recognized that Locke’s use of “labor” in his homesteading argument was really just figurative and that no assumption of labor-ownership is needed for Locke’s homesteading argument to work. Without the Lockean labor confusion, much of the intellectual case for IP evaporates (and we might have avoided the spread of the labor theory of value that infects Smithian economics and Marxism). (See my post Hume on Intellectual Property and the Problematic “Labor” Metaphor.)
• His recognition of the is-ought gap. Writes Hans-Hermann Hoppe: “one can readily subscribe to the almost generally accepted view that the gulf between ‘ought’ and ‘is’ is logically unbridgeable.” (A Theory of Socialism and Capitalism, p. 163.)
• His explanation that the state is able to maintain power only because most people give it their tacit support. As Hoppe writes:
• “One must conclude, then, that the problem of explaining how the few can rule the many is indeed real, and that socialism and the state as the incorporation of socialism must rest in addition to aggression on some sort of active support among the public.”David Hume is one of the classic expositors of this insight. In his essay on “The first principles of government” he argues:
  “‘Nothing appears more surprising to those who consider human affairs with a philosophical eye, than the easiness with which the many are governed by the few, and the implicit submission, with which men resign their own sentiments and passions to those of their rulers. When we inquire by what means this wonder is effected we shall find, that as Force is always on the side of the governed, the governors have nothing to support them but opinion. It is, therefore, on opinion only that government is founded, and this maxim extends to the most despotic and most military governments, as well as to the most free and most popular. The soldan of Egypt, or the emperor of Rome, might drive his harmless subjects, like brute beasts, against their sentiments and inclination. But he must, at least, have led his mamalukes or praetorian bands, like men, by their opinion.'” (See Hoppe, A Theory of Socialism and Capitalism, p. 179.)
• His insight that any supply of money is optimal, also a key Austrian insight. (See Hoppe, The Economics and Ethics of Private Property, p. 194; Block & Barnett, On the Optimum Quantity of Money.)
• His apparent opposition to fractional-reserve banking (see Huerta de Soto, note 5): “Before Mises, the most distinguished author who defended the one hundred percent reserve requirement was David Hume in his essay “Of Money” (1752), where he states that “no bank could be more advantageous, than such a one as locked up all the money it received, and never augmented the circulating coin, as is usual, by returning part of its treasure into commerce.” David Hume, Essays: Moral Political and Literary (Indianapolis, Ind.: LibertyClassics, 19851, pp. 284-85.”
• His realization that you could never empirically observe causation. As Hoppe writes, citing Hume: “there exists no ‘band’ that one could observe to connect visibly certain variables as causes and effects.” (A Theory of Socialism and Capitalism, p. 124; see also The Economics and Ethics of Private Property, pp. 289, 298.)

Update: See also Professor Hans-Hermann Hoppe’s brief discussion of Hume in the video clip below.

See also Cordato and Kirzner on Intellectual Property (April 21, 2011)

1. See also Wendy McElroy on Benjamin Tucker: “Tucker, however, asked the question in more fundamental terms; he asked why the concept of property existed at all.  What was there in the nature of man and of reality that made such a concept necessary?  He postulated that property arose as a means of solving conflicts caused by scarcity.  Since all goods are scarce, there is competition for their use.  Since the same chair cannot be used at the same time and in the same manner by two people, it becomes necessary to determine who should use the chair.  Property arose as an answer to this question.  “If it were possible,” Tucker wrote, “and if it has always been possible, for an unlimited number of individuals to use to an unlimited extent and in an unlimited number of places the same concrete thing at the same time, there would never have been any such thing as the institution of property.””  ↩