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Determinants and consequences of land sales market participation : panel evidence from India

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  • Deininger, Klaus
  • Jin, Songqing
  • Nagarajan, Hari K.

Abstract

Although opinions on impacts of land market transfers are sharply divided, few studies explore the welfare and productivity effects of land markets on a larger scale. This paper uses a large Indian panel spanning almost 20 years, together with a climatic shock (rainfall) indicator, to assess the productivity and equity effects of market-mediated land transfers (sale and purchase) compared with non-market ones (inheritance). The analysis shows that frequent shocks increase land market activity, an effect that is mitigated by the presence of safety nets and banks. Land sales markets improved productivity and helped purchasers, many of whom were formerly landless, to accumulate non-land assets and significantly enhance their welfare.

Suggested Citation

  • Deininger, Klaus & Jin, Songqing & Nagarajan, Hari K., 2007. "Determinants and consequences of land sales market participation : panel evidence from India," Policy Research Working Paper Series 4323, The World Bank.
    • Handle: RePEc:wbk:wbrwps:4323
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    More about this item

    Keywords

    Banks&Banking Reform; Markets and Market Access; Municipal Housing and Land; Real Estate Development;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation

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