Title

Property Rights And Urban Development: Initial Title Quality Matters Even When It No Longer Matters

Keywords

Housing quality; Property rights; Property title; Squatting

Abstract

Formal title to property allows owners to borrow for investing in improvements. Title legalization laws, however, appear to yield only modest increases in housing quality in developing countries. We offer a simple model in which squatters initially balance initial investment in low quality structures to reduce the risk of eviction against the future effect of increasing the marginal cost of improving quality. The effort to secure initial possession thereby creates a legacy effect, reducing subsequent investments in housing quality. Empirical tests using Bolivian data yield results consistent with the legacy theory: initial title risk suppresses long run housing quality. © 2013 Springer Science+Business Media New York.

Publication Date

1-1-2014

Publication Title

Journal of Real Estate Finance and Economics

Volume

49

Issue

1

Number of Pages

1-22

Document Type

Article

Personal Identifier

scopus

DOI Link

https://doi.org/10.1007/s11146-013-9417-0

Socpus ID

84901620407 (Scopus)

Source API URL

https://api.elsevier.com/content/abstract/scopus_id/84901620407

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