Eliciting demand for title deeds: lab-in-the-field evidence from urban Tanzania

Many African cities face extremely high rates of informal land ownership. Governments implement land titling projects to alleviate poverty and facilitate urban development in these unplanned and rapidly urbanizing cities. However, these programs often register low uptake. We suggest addressing this problem with a pricing strategy that elicits local demand for titles from community leaders. We study the demand for title deeds in Dar es Salaam, Tanzania, where the fixed costs of surveying and planning have been covered, conducting two lab-in-the-field experiments with 90 local leaders and 146 property owners. Demand for property titles, as elicited by the Becker-DeGroot-Marschak (BDM) method, while largely below current fees, is substantial. We then ask if local leaders can help predict this demand ex-ante. We find that leaders have accurate information about both the aggregate demand curve in their neighbourhoods, as well as, the ability to distinguish variation in willingness-to-pay across owners in their neighbourhood. Predictions of aggregate demand deteriorate under an environment where the responses of leaders are used to allocate subsidies, but an incentive scheme of cash prizes is able to mitigate this. To keep leaders from misreporting, an appropriately designed policy will compensate leaders for accuracy.