Power, Property Rights, and the Dynamics of Local Wealth Appropriation

Dan Cao (), Roger Lagunoff and Yingqi Xu
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Dan Cao: Department of Economics, Georgetown University, https://dan-cao.facultysite.georgetown.edu/

Working Papers from Georgetown University, Department of Economics

Abstract: This paper examines the dynamic connections between wealth inequality and political decisions at the local level. We model a jurisdiction consisting of a politically dominant group and a marginalized one. At each date, the dominant group tries to appropriate ownership claims on productive assets. If its claims are legally challenged, the default outcome is determined by a right of possession (ROP) principle. Despite the ROP's assurance of equal protection, the jurisdiction systematically redistributes property claims toward the dominant group. The jurisdiction appropriates wealth by leveraging common assets - those that generate non-exclusive consumption flows - using zoning, takings, or NIMBY policies. We examine how this leverage varies across time and depends on whether a common asset is a public asset (generating benefits for all) or a NIMBY (generating benefits for the dominant group while harming the marginalized one). Finally, ROPs that prioritize some assets over others can exacerbate inequality.

Keywords: Property assignment; wealth appropriation; right of possession; private; public; and NIMBY assets; zoning; takings; Dynamic Samuelson condition; asset durability and prioritization (search for similar items in EconPapers)
JEL-codes: C73 D31 D78 H13 P48 R52 (search for similar items in EconPapers)
Pages: 44
Date: 2022-05-18
New Economics Papers: this item is included in nep-cdm
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