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Land Ownership Risk and Urban Development
Author(s) -
Miceli Thomas J,
Sirmans C. F,
Turnbull Geoffrey K
Publication year - 2003
Publication title -
journal of regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.171
H-Index - 79
eISSN - 1467-9787
pISSN - 0022-4146
DOI - 10.1111/1467-9787.00290
Subject(s) - pace , land tenure , incentive , possession (linguistics) , business , statute , adverse possession , land development , land law , economics , land use , public economics , market economy , law , geography , linguistics , philosophy , archaeology , geodesy , political science , agriculture , civil engineering , engineering
Under certainty, unlimited duration of private ownership of land provides landowners with efficient development incentives. However, in cases of ownership risk arising from title mistakes, fraud, boundary encroachment, or adverse possession, the statute of limitations sets a limit on how long agents have to establish or defend an ownership claim. This paper demonstrates that such restrictions speed the pace of land development and systematically affect the development density according to site location in the urban land market. It also offers an explanation of why land owners prefer a time limit on the ability to defend their ownership. It shows that the value–maximizing statute varies across sites in the spatial market.