Notably, I'm not anarcho-capitalist. If you asked me to define capitalism, you'd just get a dumb stare. I'm an anarcho-formalist.
But I realized there's no need to get the consent of a government, or an actual tract of land. (Though 'huge...tracts of land' are nice.)
You could do it in World of Warcraft. Or, you could make your own.
Instead of computationally preventing mob-on-mob violence (MMORPG, 'MOBile,' a moving element of the game world.) you completely allow all sorts of violence.
Since modern humans have all been public-schooled and are cognitively crippled by that torture, you would have to seed it with some basic common law. Set up a court where a player can go be a judge (in return for cash) with some basic crimes - murder, theft, battery, and so on, with some basic punishments laid out.
Have an auction house like WoW so there's a market. It will, naturally, be a free market.
Because I think it would be funny, don't explicitly lay out property rights. Also, allow competing scripts for auction houses to be submitted. (Obviously they have to be combed for viruses before seeing play.) This way, competition and mutualism will have the final say in every aspect of the game world that's not specifically modeling real-world physics.
Obviously the point of this is to try to simulate the incentives mandated by the real world as closely as possible, though perhaps accelerated so that it doesn't take more than a decade for anyone to learn to be profitable.
Players will have injury and permanent death, but perhaps should keep levels.
The only question is, do you try to make it simulate the world as closely as possible to forestall, ("But WoW has MAGIC! And you want me to believe you've created Libertopia inside it?") or instead just make it so an actual reasonable person can clearly see that it could work in real life?
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