Quoting author Ben Dupre, “In the case of the social contract proposed by Hobbes and others, our acceptance of the state and its right to limit what we do is one side of a bargain; the payback is not experiencing the chaos and anarchy that would occur in its absence.” It is, then, easy to define the Social Contract as this: “An implicit agreement among the members of a society to cooperate for social benefits, for example, by sacrificing some individual freedom for state protection”.
Protection from What?
Theorists like Hobbes, 18th-century French philosopher Jean-Jacques Rosseau and Rawl all spoke of the need for the social contract as a way of staving off the anarchy that would result in a society without some authorized mediator that could keep us in check.
As Hobbes put it, ‘covenants, without the sword, are but words’. This external force is then to work as the enforcer of the social contract that we’ve all implicitly agreed to. The role of the state, for example, is the chief enforcer and protector of property rights.
If you, as an individual, couldn’t exert your ownership over your own private property, then we would not have a functioning economy, because one of the fundamental institutional requirements of “Markets” would be absent.