Investment and credit effects of land titling and registration:
AbstractThis paper analyzes the importance of legal property documents in providing tenure security, enhancing agricultural investment incentives and easing access to credit. While theory predicts that better property rights on land can increase investment through increased security, enhanced trade opportunities and increased collateral value of land, the presence and size of these effects depend crucially on whether those rights are properly enforced. In Nicaragua, a troubled history of land expropriation and invasion has undermined the credibility of the legal property regime. The variation in legal ownership status due to a land titling and regularization programme is studied to identify the effects of legal ownership documents. Possession of a registered document is found to increase the probability of carrying out land-attached investments by 35%. No difference is found in the effect of public deeds and agrarian reform titles provided they are both registered and we find no strong evidence of a credit supply link, thus suggesting security of tenure as the channel through which formal land ownership has an effect on investment. --
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Bibliographic InfoPaper provided by Verein für Socialpolitik, Research Committee Development Economics in its series Proceedings of the German Development Economics Conference, Kiel 2005 with number 10.
Date of creation: 2005
Date of revision:
Property rights; investment; land reform; Nicaragua; land ownership;
Find related papers by JEL classification:
- Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
- O13 - Economic Development, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
- D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
- K11 - Law and Economics - - Basic Areas of Law - - - Property Law
This paper has been announced in the following NEP Reports:
- NEP-AGR-2006-08-05 (Agricultural Economics)
- NEP-ALL-2006-08-05 (All new papers)
- NEP-LAW-2006-08-05 (Law & Economics)
- NEP-URE-2006-08-05 (Urban & Real Estate Economics)
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