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The political economy of rural property rights and the persistence of the dual economy

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  • Fergusson, Leopoldo

Abstract

Rural areas often have more than one regime of property rights and production. Large, private-property farms owned by powerful landowners coexist with subsistence peasants who farm small plots with limited property rights. At the same time, there is broad consensus that individual, well-specified and secure property rights over land improve economic outcomes. If property rights in land are so beneficial, why are they not adopted more widely? I put forward a theory according to which politically powerful landowners choose weak property rights to impoverish peasants and force them to work for low wages. Moreover, because weak property rights force peasants to stay in the rural sector protecting their property, the incentives to establish poor property rights are especially salient when peasants can migrate to an alternative sector, such as when urban wages increase with industrialization.

Suggested Citation

  • Fergusson, Leopoldo, 2013. "The political economy of rural property rights and the persistence of the dual economy," Journal of Development Economics, Elsevier, vol. 103(C), pages 167-181.
  • Handle: RePEc:eee:deveco:v:103:y:2013:i:c:p:167-181
    DOI: 10.1016/j.jdeveco.2013.02.009
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    Cited by:

    1. Pi Jiancai & Ge Yang & Yin Jun, 2017. "The Impacts of Rural Property Rights on Urban Unemployment, Wage Inequality, and Welfare in Developing Countries," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 17(1), pages 1-15, February.
    2. Mizuno, Nobuhiro, 2016. "Political structure as a legacy of indirect colonial rule: Bargaining between national governments and rural elites in Africa," Journal of Comparative Economics, Elsevier, vol. 44(4), pages 1023-1039.
    3. Pedro Naso & Erwin Bulte & Tim Swanson, 2017. "Can there be benefits from competing legal regimes? The impact of legal pluralism in post-conflict Sierra Leone," CIES Research Paper series 56-2017, Centre for International Environmental Studies, The Graduate Institute.
    4. Juan Carlos Muñoz-Mora & Santiago Tobón-Zapata & Jesse d'Anjou, 2014. "Does land titling matter? The role of land property rights in the war on illicit crops in Colombia," HiCN Working Papers 168, Households in Conflict Network.
    5. Rodriguez Acosta, Mauricio, 2016. "Essays in political economy and resource economic : A macroeconomic approach," Other publications TiSEM 1e39ef1b-43a2-4f95-892c-6, Tilburg University, School of Economics and Management.
    6. de Janvry, Alain & Gonzalez-Navarro, Marco & Sadoulet, Elisabeth, 2014. "Are land reforms granting complete property rights politically risky? Electoral outcomes of Mexico's certification program," Journal of Development Economics, Elsevier, vol. 110(C), pages 216-225.
    7. Pi Jiancai & Zhou Yu, 2015. "Rural Property Rights, Migration, and Welfare in Developing Countries," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 15(3), pages 997-1029, July.
    8. repec:eee:wdevel:v:103:y:2018:i:c:p:268-283 is not listed on IDEAS

    More about this item

    Keywords

    Political economy; Institutions; Economic development; Taxation; Property rights; Land; Dualism;

    JEL classification:

    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • N10 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - General, International, or Comparative
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

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