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Land acquisition: Political intervention, voice and fragmentation

Author

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  • Prabal Roy Chowdhury

    () (Indian Statistical Institute, New Delhi)

Abstract

This paper develops a simple dynamic framework of holdout in land acquisition (both with and without political intervention), where holdout arises because of the landowners' inability to manage large sums of money (and consequent lack of inter-temporal consumption smoothing in case of sale). We then use this framework to analyze two issues, political intervention and fragmentation, showing that the results depend on a subtle interaction of voice, collective bargaining and the severity of fragmentation. Political intervention leads to a large party size (and is consequently more likely) in case it leads to voice for both members and non-members, but not otherwise. Moreover, under both these scenarios, politicization may lead to inefficiency. Further, the efficiency implications of fragmentation also depend on the nature of politicization, with fragmentation increasing holdout in the absence of politicization.

Suggested Citation

  • Prabal Roy Chowdhury, 2010. "Land acquisition: Political intervention, voice and fragmentation," Indian Statistical Institute, Planning Unit, New Delhi Discussion Papers 10-05, Indian Statistical Institute, New Delhi, India.
  • Handle: RePEc:ind:isipdp:10-05
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    File URL: http://www.isid.ac.in/~pu/dispapers/dp10-05.pdf
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    References listed on IDEAS

    as
    1. Matthew Rabin & Ted O'Donoghue, 1999. "Doing It Now or Later," American Economic Review, American Economic Association, vol. 89(1), pages 103-124, March.
    2. Eckart, Wolfgang, 1985. "On the land assembly problem," Journal of Urban Economics, Elsevier, vol. 18(3), pages 364-378, November.
    3. Roy Chowdhury, Prabal & Sengupta, Kunal, 2012. "Transparency, complementarity and holdout," Games and Economic Behavior, Elsevier, vol. 75(2), pages 598-612.
    4. Binswanger, Hans P. & Deininger, Klaus & Feder, Gershon, 1995. "Power, distortions, revolt and reform in agricultural land relations," Handbook of Development Economics,in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 42, pages 2659-2772 Elsevier.
    5. David Laibson, 1997. "Golden Eggs and Hyperbolic Discounting," The Quarterly Journal of Economics, Oxford University Press, vol. 112(2), pages 443-478.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Land acquisition; holdout; fragmentation; politics; voice; collective bargaining;

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • R52 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Land Use and Other Regulations

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