Who decides what I shall eat for breakfast?
I think we need to clarify what we are actually discussing. I think that one assumption was that our society is an anarcho-capitalist society. But in such a society, each individual is free to exchange and dispose of his land, labor and capital as he sees fit. Just as I choose what to eat (or not eat) for breakfast, I also choose how to settle disputes with other individuals, rather than be forced to use the “service” of government courts, police, etc.
No one individual decides what the facts are in a dispute that arises between two people, unless those two people decide to take the matter to one person, and they agree that he shall be judge, jury and executioner (the “tribal chief” model of justice). Many kinds of justices may arise, but it is impossible from an economic point of view to predict what level of variety their would be. We can speculate.
For instance, one part of the legal process involves fact-finding. Now the more time and resources that are devoted to this task, the easier will be the task of the jury (which may be one individual or many, or the same person as the judge, …). But as we live in a world of scarcity, and I assume an anarcho-capitalist world will also be scarce, the level of fact-finding that is purchased will be determined by those who are paying for the trial or hearing. If the judge takes a personal interest, even he may chip in a few coins, so long as he is not barred from doing so by his employer or in any contracts.
If a party in the proceeding is unsatisfied with the outcome, he may not use the services of the court in the future, he may express his displeasure to others, and so on. The court will have to allocate available factors of production in order to continue satisfying customers or risk going out of business, and this is especially true for the marginal producers. As the wealth in society increases, and to the extent that individuals have a demand for dispute resolution, their savings may be used to lengthen the production process in the area of dispute resolution. Some courts may use the newly saved money, for instance, to do research into land property records and land title, research that is too expensive for other courts, or not their area of expertise. These “land records” courts could specialize in cases involving disputes over land ownership. Maybe the next scientific innovation they would adopt as wealth further expands is the use of satellite technology. And so on.
The “decision,” then results from two individuals (or individuals representing companies, firms, etc.) purchasing the services of a court.
Which leads to another question (at least in my mind). “How can the decision have the force of law (or be enforced)?”
In the matter of what constitutes justice, I admit that much that I have read on the matter coming from libertarians appears to be very unenlightening. One popular conception of justice is equalization, or making the victim whole. This may be correct from an ethical point of view, or even a good starting point in deriving an ethics of justice, but it tells us nothing about the operation of justice in a free society. It always runs aground on issues of how to force the perpetrator to make the victim whole, i.e. how to force the perpetrator to accept decisions that are unfavorable for him.
Of course, there is no law (in the monopolistic sense) in anarchy (which is not to say that there is no order). Now if the society is very poor, then enforcement (or failure to enforce) will fall upon each individual, since the resources to pay other individuals to enforce the decision are being allocated by each individual to other wants, or they are hoarding. This is the method of shunning, where each individual shuns the person who has a judgement against them. But I only use “shun” for lack of a better term, it can range from refusal to transact with a person, to some limited charity towards the outcast. Each individual decides how to behave toward the shunned person.
If we have specialization, then the enforcement of the decision will be by an agency or individual wholly separate from the courts, an agency or individual whose services are purchased on the market. If resources are available and a specialized agency for enforcement exists (due to consumer demnad), then again the market will determine the actions of the individuals running the enforcement agency. Maybe one agency will make notice of judgements against a person and compile “blacklists” for use by businesses or the self-employed. In such a way, the owner of a road or commercial building may prevent someone who is blacklisted from using their service, or charge them a higher fee, or act as a collector for the damaged party. For example:
X agresses against Y (fact). X flees from the scene of the crime. Y (or his insurance company) pays agency G to compile information regarding the incident (similar to a police report, but obviously superior since we now have a profit-seeking business instead of a monopolistic, bureaucratic, wasteful and consumer-unresponsive agency). G contracts with A, where A is the owner of the land where the incident took place. A sells G video from cameras that A had set up. This video will provide evidence when Y makes his case. Y also contracts with H, which is a company that specializes in finding people. H compiles a list of “suspects” for Y. Now Y goes to J, an agency whose business is to disseminate information about alleged criminals. J purchases from Y all of the information about the suspects (who happen to include X) and sells that information to security agencies. These security agencies, concerned with maintaining the safety of individuals on various pieces of private property (those purchasing security services), eventually locate the suspected individuals (including X) and inform them of the claim being lodged against them.
Now none of these individuals need to “surrender”, as they are merely suspects. However, to the degree that the charge against them is serious, they will tend to turn themselves in (or agree to dispute resolution with the party that is making a claim against them). They face, beyond possible physical exile (which would mean they could not cross the property of any other person), varying degrees of forced autarky. Being suspected of a crime would have an effect similar to a bad mark on your credit. When a person’s credit is ruined, that just means that creditors are unwilling to lend the individual money, or to do so but at a much higher premium than otherwise. Similarly, a tarnished reputation means that other individuals are unwilling to let the suspect or criminal use their service for fear of what he might do. The suspect/criminal may say he just wants to use the road to get to where he is going, but the road-owner has reason to suspect that he might be a highway robber. The suspect or criminal will be hampered until he agrees to dispute resolution.
And so the market has a way of bringing about settlements, because of the preferences of the consumers for safety on roads they pay for, or at places of business, or anywhere else, in addition to the preference of individuals to obtain the lowest price for goods and have access to an abundance of vendors, which is hampered by a black mark on one’s name.