Land Titling and Litigation
Arruñada, Benito, Marco Fabbri and Michael Faure (2021), “Land Titling and Litigation”, Journal of Law and Economics, forthcoming.
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We study a land titling reform implemented as a randomized control-trial to isolate its effects on litigation. The reform consisted of demarcating land parcels, registering existing customary rights, and granting additional legal protection to rightholders. Ten years after implementation, the reform doubled the likelihood of households experiencing land-related litigation, but disputes did not escalate into more frequent violent episodes. We suggest that this litigation increase reflects the complementarity of land titling by registration and by judicial procedures aimed at further clarifying property rights, as the reform registered titles to all parcels but left many of these titles subject to adverse claims. This raised the demand for complementary litigation aimed at perfecting titles for low value parcels which, under the customary system, it was individually optimal to keep unclarified. Consistent with this explanation, we find that the increase in litigation takes place among households who plausibly own land of lower value.