The basis of individual rights lies in property. Property is not merely material acquisition—it is central to an individual’s assertion of identity and personality. Property is an expression of self and the locus of an individual’s claim to rights, since it is through property that one can say "this is mine," a claim that others respect. Property is the "embodiment of personality," says Hegel. The system of private property establishes individuality and personality through contract and exchange. Contract establishes ownership through institutionalized norms of mutual respect of individual rights and obligations. Economic life governed by free exchange of commodities is based on an institutionalized notion of the individual as having some claim to recognition as a right-bearing person. If an exchange market is to function efficiently, economic actors must recognize universal standards by which a person can claim to own property. Established norms of reciprocal recognition in the modern economic sphere are internalized in economic actors and represent a "common will."
The concept of individual rights to which this common will gives its assent is an abstract concept. The individual it implies is a universal individual without particular traits and without reference to social or cultural environment. Thus, rights established by private property and exchange are "abstract rights" and engage individuals as abstract, universal subjects. The system of mutual recognition and abstract right is the basis of what Hegel calls morality. Morality is essentially the subjective side of the reciprocal social obligations institutionalized in contracts and the economic market. Individuals experience such reciprocal obligations as a moral obligation to respect universal rights. Morality gestures toward what ought to be and frequently is not. It is an abstract ideal, a vision of good based on mutual recognition of rights. People are morally motivated through a sense of duty to defend the universal rights of individuals.
In Elements of a Philosophy of Right, Hegel attempts to fuse diverse elements of his philosophy and social thought into a grand statement about the nature of modernity. He traces a modern conception of individuality and of the individual as the bearer of rights to modern social, economic, and political institutions. He also describes how this modern notion of the individual, while positive in many ways, gives rise to certain stresses and to the alienation of the individual from the collective. In the first section, Abstract Right, Hegel returns to a theme of earlier writings in which he wrestles with the fairly common belief in "natural rights" that are present in the various "social contract" theories of, for example, John Locke, where social or political order is said to derive its legitimacy from its ability to uphold and protect the rights of autonomous, sovereign individuals.
For Locke and others, the social is merely the outcome of a contract between autonomous individuals to respect each other’s rights. In this view, the extent of one person’s relationship to another can be summed up in the slogan, "Be a person and respect others as a person." Hegel believes this view of social life to be generally accurate, but he rejects the belief that contractual mutual recognition and the ideal of the universal-rights-bearing individual it supports is a basis of all societies throughout history. The worldview implied in contract theory and in the moral obligation to respect individual rights is not the foundation of social life but rather a reflection of the spirit of the modern age. This spirit resides in modern legal and economic institutions, which foster an idea of abstract rights and universal personhood. Hegel therefore applies his theory of history and culture to an analysis of the modern world. He also criticizes both contemporary political theory and idealist moral philosophy for not recognizing that the phenomena they recognize as universal laws are actually particular expressions of modern culture.