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

Leopoldo Fergusson

Journal of Development Economics, 2013, vol. 103, issue C, 167-181

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.

Keywords: Political economy; Institutions; Economic development; Taxation; Property rights; Land; Dualism (search for similar items in EconPapers)
JEL-codes: H2 N10 O1 O10 P16 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (33)

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Related works:
Working Paper: The Political Economy of Rural Property Rights and the Persistence of the Dual Economy (2012)
Working Paper: The Political Economy of Rural Property Rights and the Persistence of the Dual Economy (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:deveco:v:103:y:2013:i:c:p:167-181

DOI: 10.1016/j.jdeveco.2013.02.009

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