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A Theory of Urban Squatting and Land-Tenure Formalization in Developing Countries

  • Jan K. Brueckner
  • Harris Selod

This paper offers a new theoretical approach to urban squatting, reflecting the view that squatters and formal residents compete for land within a city. The key implication is that squatters "squeeze" the formal market, raising the price paid by formal residents. The squatter organizer ensures that squeezing is not too severe, since otherwise, the formal price will rise to a level that invites eviction by landowners. Because eviction is absent in equilibrium, the model differs from previous analytical frameworks, where eviction occurs with some probability. It also facilitates a general equilibrium analysis of squatter formalization policies. (JEL O15, Q15, R14)

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Article provided by American Economic Association in its journal American Economic Journal: Economic Policy.

Volume (Year): 1 (2009)
Issue (Month): 1 (February)
Pages: 28-51

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Handle: RePEc:aea:aejpol:v:1:y:2009:i:1:p:28-51
Note: DOI: 10.1257/pol.1.1.28
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  1. Jha, Saumitra & Rao, Vijayendra & Woolcock, Michael, 2005. "Governance in the gullies : democratic responsiveness and leadership in Delhi's slums," Policy Research Working Paper Series 3694, The World Bank.
  2. Gilles Duranton, 2007. "From cities to productivity and growth in developing countries," Working Papers tecipa-306, University of Toronto, Department of Economics.
  3. Robert M. Buckley & Jerry Kalarickal, 2006. "Thirty Years of World Bank Shelter Lending : What Have We Learned?," World Bank Publications, The World Bank, number 7061.
  4. Friedman, Joseph & Jimenez, Emmanuel & Mayo, Stephen K., 1988. "The demand for tenure security in developing countries," Journal of Development Economics, Elsevier, vol. 29(2), pages 185-198, September.
  5. Hoy, Michael & Jimenez, Emmanuel, 1991. "Squatters' Rights and Urban Development: An Economic Perspective," Economica, London School of Economics and Political Science, vol. 58(229), pages 79-92, February.
  6. Jimenez, Emmanuel, 1985. "Urban squatting and community organization in developing countries," Journal of Public Economics, Elsevier, vol. 27(1), pages 69-92, June.
  7. repec:oup:qjecon:v:122:y:2007:i:1:p:209-241 is not listed on IDEAS
  8. Catherine Farvacque-Vitkovic & Lucien Godin & Hugues Leroux & Florence Verdet & Roberto Chavez, 2005. "Street Addressing and the Management of Cities," World Bank Publications, The World Bank, number 7342.
  9. Zenou, Yves, 2002. "How do firms redline workers?," Journal of Urban Economics, Elsevier, vol. 52(3), pages 391-408, November.
  10. Galiani, Sebastian & Schargrodsky, Ernesto, 2004. "Effects of land titling on child health," Economics & Human Biology, Elsevier, vol. 2(3), pages 353-372, December.
  11. Jean O. Lanjouw & Philip I. Levy, 2002. "Untitled: A Study of Formal and Informal Property Rights in Urban Ecuador," Economic Journal, Royal Economic Society, vol. 112(482), pages 986-1019, October.
  12. Zenou, Yves & Boccard, Nicolas, 2000. "Racial Discrimination and Redlining in Cities," Journal of Urban Economics, Elsevier, vol. 48(2), pages 260-285, September.
  13. repec:oup:qjecon:v:122:y:2007:i:4:p:1561-1602 is not listed on IDEAS
  14. Field, Erica Marie, 2005. "Property Rights and Investment in Urban Slums," Scholarly Articles 3634150, Harvard University Department of Economics.
  15. Lall, Somik V. & Lundberg, Mattias K.A. & Shalizi, Zmarak, 2008. "Implications of alternate policies on welfare of slum dwellers: Evidence from Pune, India," Journal of Urban Economics, Elsevier, vol. 63(1), pages 56-73, January.
  16. Spinnewyn, Frans & Svejnar, Jan, 1990. "Optimal Membership, Employment, and Income Distribution in Unionized and Labor-Managed Firms," Journal of Labor Economics, University of Chicago Press, vol. 8(3), pages 317-40, July.
  17. Erica Field, 2005. "Property Rights and Investment in Urban Slums," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 279-290, 04/05.
  18. Jimenez, Emmanuel, 1984. "Tenure Security and Urban Squatting," The Review of Economics and Statistics, MIT Press, vol. 66(4), pages 556-67, November.
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