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Inefficiency And Abuse Of Compulsory Land Acquisition--An Enquiry Into The Way Forward

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  • RAM SINGH

    (Department of Economics, Delhi School of Economics, Delhi, India)

Abstract

This paper focuses on two issues--the problems with the compulsory acquisition of land, and the regulatory and institutional impediments that obstruct voluntary land transactions. We argue that any compulsory acquisition based process is intrinsically inefficient and unfair, even if it is accompanied by presumably benevolent schemes such as land-for-land and the R&R packages. Moreover, it is inherently prone to litigation. We demonstrate how what we call the 'regulatory hold-up' precludes a large number of potential transactions in agriculture land, and puts a downward pressure on land prices. The paper offers suggestions for reforming the legal and regulatory framework governing the land and its use. Finally, we discuss the Land Acquisition and Rehabilitation & Resettlement (LARR) Bill 2011. We show that the bill leaves open several backdoors for the states to favour companies. Movreover, it fails to address the fundamental causes behind rampant disputes and litigation over compensation.

Suggested Citation

  • Ram Singh, 2012. "Inefficiency And Abuse Of Compulsory Land Acquisition--An Enquiry Into The Way Forward," Working papers 209, Centre for Development Economics, Delhi School of Economics.
    • Handle: RePEc:cde:cdewps:209
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    References listed on IDEAS

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    1. National Advisory Council NAC, 2011. "Proposals of Working Group for Consideration of NAC-II: Suggestions for Land Acquisition (Amendment) Bill 2009 and Resettlement and Rehabilitation Bill, 2009," Working Papers id:4342, eSocialSciences.
    2. Maitreesh Ghatak & Parikshit Ghosh, 2011. "The Land Acquisition Bill-- A Critique and a Proposal," Working papers 204, Centre for Development Economics, Delhi School of Economics.
    3. Sarthak Gaurav & Srijit Mishra, 2011. "Size-class and returns to cultivation in India: A Cold case reopened," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2011-027, Indira Gandhi Institute of Development Research, Mumbai, India.
    4. Deininger, Klaus & Jin, Songqing & Nagarajan, Hari K., 2009. "Determinants and Consequences of Land Sales Market Participation: Panel Evidence from India," World Development, Elsevier, vol. 37(2), pages 410-421, February.
    5. Munch, Patricia, 1976. "An Economic Analysis of Eminent Domain," Journal of Political Economy, University of Chicago Press, vol. 84(3), pages 473-497, June.
    6. Morris, Sebastian & Pandey, Ajay, 2007. "Towards Reform of Land Acquisition Framework in India," IIMA Working Papers WP2007-05-04, Indian Institute of Management Ahmedabad, Research and Publication Department.
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    Citations

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    Cited by:

    1. Nandwani, Bharti, 2022. "Community forestry and its implications for land related disputes: Evidence from India," European Journal of Political Economy, Elsevier, vol. 73(C).
    2. A. Patrick Behrer & Edward L. Glaeser & Giacomo A. M. Ponzetto & Andrei Shleifer, 2021. "Securing Property Rights," Journal of Political Economy, University of Chicago Press, vol. 129(4), pages 1157-1192.
    3. Sreeparna Saha & Prabal Roy Chowdhury & Jaideep Roy & Prasad Bhattarcharya, 2016. "Political Economy of Land Acquisition and Holdout," Discussion Papers 16-07, Indian Statistical Institute, Delhi.
    4. Soumendu Sarkar, 2017. "Mechanism design for land acquisition," International Journal of Game Theory, Springer;Game Theory Society, vol. 46(3), pages 783-812, August.
    5. Schäfer Hans-Bernd, 2019. "Rules versus Standards in Developing Countries: the Case for Clear and Precise Legal Norms on Eminent Domain Power," The Law and Development Review, De Gruyter, vol. 12(2), pages 425-455, June.
    6. Patil, Vikram & Ghosh, Ranjan & Kathuria, Vinish & Farrell, Katharine N., 2020. "Money, Land or self-employment? Understanding preference heterogeneity in landowners’ choices for compensation under land acquisition in India," Land Use Policy, Elsevier, vol. 97(C).
    7. Nitika Dhingra, 2022. "Political economy of law, efficiency and adverse ‘inclusion’: rethinking land acquisition in India," Review of Evolutionary Political Economy, Springer, vol. 3(2), pages 379-403, July.
    8. Ram Singh, 2018. "Public Private Partnerships Vs. Traditional Roads Project Delivery Time, Costs and Quality," Working papers 290, Centre for Development Economics, Delhi School of Economics.
    9. Ram Singh, 2022. "Do the Wealthy Underreport their Income? Analysing Relationship between Wealth and Reported Income in India," Working papers 331, Centre for Development Economics, Delhi School of Economics.
    10. Hans-Bernd Schäfer & Ram Singh, 2018. "Takings of Land by Self-Interested Governments: Economic Analysis of Eminent Domain," Journal of Law and Economics, University of Chicago Press, vol. 61(3), pages 427-459.
    11. Vikram Patil & Ranjan Ghosh, 2017. "Rehabilitation Myths? How Transaction Costs Reduce Farmer Welfare After Land Acquisition," Journal of South Asian Development, , vol. 12(1), pages 1-17, April.
    12. Tran Tuan Nguyen, 2021. "Shrinking agricultural land and changing livelihoods after land acquisition in Vietnam," Bulletin of Geography. Socio-economic Series, Sciendo, vol. 53(53), pages 17-32, September.
    13. Cheng, Mingda & Du, Julan & Ye, Chunhui & Zhang, Qi, 2022. "Your misfortune is also mine: Land expropriation, property rights insecurity, and household behaviors in rural China," Journal of Comparative Economics, Elsevier, vol. 50(4), pages 1068-1086.
    14. Jyoti Shukla & Piyush Tiwari, 2022. "Measuring Inadequacy in Compensation for the Compulsory Acquisition of Land: Evidence from Bengaluru, India," Land, MDPI, vol. 11(5), pages 1-16, April.

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