Applied Economics 8703:
Lecture #4
Rural Land Markets in Developing Countries (Part I)
I. Introduction
In rural areas of developing countries, land is:
•
The most important productive asset (with the
possible exception of labor)
•
Often the most important form of wealth
•
The main way parents pass wealth to children
Land use patterns and land rights (ownership & rental
rights) evolve slowly over centuries. Yet sometimes
quick changes result from government policies. The
evolution of land rights over time is influenced by:
•
population density (very low densities imply that
much land is available, so there is little need to
set up a system of private ownership)
•
technological progress (improved farming
technologies raise the marginal product of land
and thus raise its value, which increases the need
for clear property rights)
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