From Commons to Claims: Property Rights in the California Gold Rush

Abstract

Scholars have long been interested in the emergence of a system of property rights in the California gold mines in 1848 to 1850, when California experienced a complete disintegration of its government, law, and social order. At the end of the Mexican War in 1848, the region was left without a legislature, without bureaucracy, without a law code except in theory, and without police or jails. Its non-native population numbered about 15,000. By the end of the next year, however, 100,000 gold-seekers - all men, all hoping to strike it rich, and almost none having a long-term interest in California - had poured into the mining region from every corner of the globe. Though many had traveled in companies formed in their hometowns, these split up upon reaching the mines; and although family, friends, and immigrants from the same state frequently dug near one another, most of the miners in any given camp were strangers to each other. This was as close to a state of nature as Americans would ever come. Not only were there no institutions to enforce the laws, there were no laws. Certainly there were no laws governing property rights in mineral lands; and because this was America's first gold rush, the Americans had no experience or customs to fall back on. American miners created, codified, and enforced a new system of property rights based on mining claims - not fee-simple - with extraordinarily tight restrictions on claimholders' rights. The genesis of this regime, the nature of the rights it created, and the principles and expectations on which it was based are the subject of this article.