The entitlement theory has three components. The principle of justice in acquisition specifies how one can come to own previously un-owned things — by mixing one's labour with them, following a Lockean proviso that enough and as good is left for others. The principle of justice in transfer specifies how holdings can pass legitimately from one person to another — through voluntary exchange, gift, or bequest. The principle of rectification of injustice specifies what must be done when a distribution has arisen partly through violation of the first two principles — through theft, fraud, or conquest. A just distribution is one that has arisen exclusively through just acquisition and just transfer from just initial holdings.
Nozick's most celebrated argument against patterned theories of justice — egalitarianism, desert-based theories, welfare-maximising theories — is the Wilt Chamberlain argument. Start with any distribution D1 that your favourite patterned theory endorses as just. Now allow people to make voluntary exchanges: Wilt Chamberlain is a great basketball player; a million people each give him 25 cents to watch him play. The result, D2, differs from D1 — Chamberlain is now much richer. But each individual transaction was voluntary and endorsed by both parties. Any principle that condemns D2 must continuously interfere with voluntary transactions to maintain its preferred pattern — and this continuous interference violates liberty.
The deep insight behind the entitlement theory is that justice is a historical property of distributions, not a structural one. We cannot assess the justice of a distribution by looking at its pattern — who has how much relative to whom — without knowing how that pattern came about. A world in which everyone has equal holdings might be unjust if those holdings were obtained through expropriation; a world with great inequality might be just if all transfers were voluntary. This historical approach to justice sets Nozick's theory fundamentally apart from Rawls's structural account and from utilitarian theories focused on outcomes.
The entitlement theory and Wilt Chamberlain argument occupy chapters 7–8 of Anarchy, State, and Utopia. The theory has generated an enormous critical literature; key objections concern the proviso, the problem of rectification for historical injustices like slavery, and the coherence of "voluntary" in conditions of severe background inequality.