Asumamos que sepamos cuál es la solución!!!

1. Asumamos que sepamos cuál es la solución!!! William L. Hoover Professor of Forest Economics Department of Forestry and Natural Resources Purdue University West Lafayette, Indiana, USA Sabbatico, CATIE, Turrialba,Costa Rica Profesor de economía

2. Property Rights:The Game Depends on Who Is Playing The “game” is “rent seeking” Cristóbal Colón

3. Rent Seeking • “People” seek economic gain by, • Changing the rules of the game, or • Exchanges of property (wealth capture) • In general, it’s human behavior creating and adapting property rights systems SE ALQUILER

4. Focus on Legal Aspects? • To what extent can “the law” -- its administration and enforcement affect human behavior? • What are the roles of customs, family and personal relationships, aggressive behavior?

5. James D. Wolfenson, President, World Bank GroupJanuary 21, 1999, “A Proposal for a Comprehensive Development Framework” “A government must ensure that it has an effective system of property, contract, labor, bankruptcy, commercial codes, personal rights laws and other elements of a comprehensive legal system that is effectively, impartially and cleanly administered by a well-functioning, impartial and honest judicial and legal system.”

6. James D. Wolfenson, President, World Bank GroupJanuary 21, 1999, “A Proposal for a Comprehensive Development Framework” Concerning a “Private Sector Strategy” he states that: “whether the issue is protection of property rights or fair and equitable labor practices, governments must give certainty to the investor about the “rules of the game.” Writing Codex Justinianus

7. Focus on Idealized Economic Aspects? • Efficiency achieved when property rights are characterized by, • Universality • All resources privately owned • All rights completely specified • Exclusivity • Owner receives all benefits and incurs all costs • Enforceability • All rights secure from involuntary seizure or encroachment • Transferability • All rights transferable from one owner to another in voluntary exchanges

8. Taxonomy of Property Rights “Games” High degree of legal formality International law National law High degree of political formality Provincial law Legal system Municipal law Avoid legal formality Local customs Low degree of political formality Family relationships Politics & Social Capital

9. Property Rights “Structure” The rules of the game as understood by those in the game, i.e. those having an interest in “property” Written law Customs Legal Pluralism Bride burning in India

10. Examples of Property Rights Games

11. Modern Multi-National Corporation • Ready and cost effective access to • Legal systems • Political systems • Fee simple (pleno dominio) title to property • Efficient PR structure • Fairly easy to identify • Firms’ behavior predictable

12. Domestic Business • Somewhat less ready and cost effective access to • Legal systems • Political systems • Fee simple (pleno dominio) title to property • Efficient PR structure • Fairly easy to identify • Firms’ behavior predictable

13. “Extralegal” Enterprises • Operate outside legal systems • Focus is on urban enterprises • May seek recognition in local political systems • PR’s self-enforced within immediate community • Effects of “tenure program” difficult to predict Institute of Liberty and Democracy, Lima, Peru

14. Rural Landowner - latifundio • Can afford lawyers and not afraid of legal system • Works local political system very well • Fee simple (pleno dominio) title to property • “Takes advantage” of local real estate market

15. Rural Land Renter - ejido or tierra privado • Depends on local politicians for community land to rent • Usually try to avoid legal system • Works political system in terms of party affiliation • Object of land tenure programs • Has better access to land than may at first appear • My not want to risk “goodwill” developed over the years

16. LandlessCampesino - labriego • Depend on landowners for work • May have milpa on land of family or employer • Avoids legal system • Limited political involvement • Frequently intended beneficiaries of land tenure programs • Hard to pay required fees • Uncertain of title because of previous chain of ownership • Hard to predict affect of programs because of effect on customary practices Better than average milpa

17. Indigenous Peoples -resguardos or territoro • May be extralegal - legal pluralism applies • Property rights based on “kinship group,” family, semi-political group • Most land may be common property • Access to resources controlled by custom and village leadership • Frequently non-agrarian Emberá Culture, Panama Photo credit: Indigenous Artisans of Panamá http://panart.com/artisans.htm UN Intl. Labor Org. C169 - Indigenous and Tribal Peoples Convention, 1989 L

18. Basic Concepts • What is property? • What are rights? • What is a PR structure? Photo credit: Fine Arts Museum of San Franciso, http://www.thinker.org/

19. What is “Property” • Numerous ways to classify animate and inanimate objects - “things” • Something is “property” if it has value to someone after costs are considered • Characteristics of a given “thing” affect how rights are “structured” Personal property Real property

20. Incidents (Rights) of Ownership • Use and manage - control of property • Income - right to receive it • Capital - use for production of income • Possession - physically occupy • Security - borrow against it • Absence of term - rights don’t terminate • Prohibition of harmful use - can’t create hazards or nuisances • Residuary character - owner has all rights not specifically excluded Deed Survey

21. What is “Property” • Most things have a range of attributes • Consider “land” as “property” • Till- grow crops • Pasture - graze • Timber - harvest • Non-timber forest products - gather • Wildlife - harvest • Minerals - extract • Improvements - buildings • Access -recreation

22. Divided Ownership May Increases Total Wealth to Society • Partition ownership of attributes based on • Transactions and production costs • Constrain uncompensated exploitation • Capacity to accommodate variation in income stream

23. Examples • Landowner could lease right to • Extract minerals • Raise crops and graze • Gather nontimber forest products • Hunting for wildlife • Access for recreation • Landowner could sell or donate development rights with a “conservation easement” L

24. What is a “Right” • Relationships among “people” having an interest in a “thing” • People - natural and corporate • Relationships - legal, commercial, social, family, personal • Exist only to extent • Recognized, • Enforced, • Rationale - value of right exceeds cost of enforcement Enforcement Goodwill

25. Basic Structures • Open access - • Open to anyone to use • Use will increase until no user can make a profit • Degree of scarcity is critical issue • Degradation will occur if level of use exceeds sustainable level • Common pool (“commons”)- • Open to a defined group • Problems arise as scarcity increases • Do users have means for “effective control”

26. Tragedy of the Commons? • Open access resource • tragedy inevitable when use exceeds sustainable level • Common pool resources • tragedy less likely but control mechanism must be effective

27. Basic Structures • Private • “Single” owner - natural or corporate person • Complete control • Owner assumed to maximum long-term value of property • Capital asset value (resale value) • Protects against misuse • Optimizes rate of utilization • Income flow - make best economic use of property • Combinations • Different attributes may have different structures

28. Rights Come at a Cost • “Transactions cost” • Maintain possession • Physical • Flows of income • Occupy • Maintain boundary lines • Legal • Transfer of rights • Borne by • Society • Owner • Third parties

29. Reflects Economic, Social, Political Conditions • Changes driven by • Social conflict and cooperation • Rent seeking behavior • Increase in economic efficiency • Maximize income • Manner of operation • Transfers to owners who can capture more rent

30. Commons to Private • As “primitive” societies evolve tends to be transition from common to private property • Driving force is scarcity • Balance between common and private property determined by • Cost of exclusion • Proportional to • Number of firms/people using the commons • Size of commons

31. Commons for Environmental Outputs • Private production • Voluntary output on private land • Complementary with owner’s objectives • Purchased specifically for this purpose • Public intervention • Provide incentives to private landowners • Purchase land or acquire easements

32. Land Reform Programs • Very expensive • Requires “reallocation” of existing rights • Poor record of “success” in terms of reducing rural poverty Landless Workers Movement, Brazil

33. Land Reform Programs • Creates opportunities for “rent seeking” behavior • May require political reform at local level • Should include permanent restructuring of administrative and adjudicative systems in areas affected L Landless Workers Movement Training Session, Brazil

34. “Redistributing land to small-scale farmers can do much to reduce their poverty. When rural families have land, and secure control over that land, they are likely to grow more food and see their incomes rise. Land security can mean food security.” (Communications and Public Affairs Unit, International Fund for Agricultural Development, http://www.ifad.org/media/pack/land.htm)

35. "When one reads the list of items needed for successful land reforms, it is a complete menu for economic development. But then it is probably better to aim explicitly at economic development, and if such development necessitates land reform, that is the appropriate time to face up to this issue." Salim Rashid, Professor of Economics, University of Illinois, 2/1/0, s-rashid@staff.uiuc.edu

36. Land Tenure CenterUniversity of Wisconsin-MadisonUSA 1357 University Avenue Madison, WI 53715Phone: (608) 262-3657 Fax: (608) 262-2141 Email: ltc-uw@facstaff.wisc.eduTELEX: 3797422 Attn: Land Tenure http://www.wisc.edu/ltc/

37. International Association for theStudy of Common Property(IASCP) WORKSHOP IN POLITICAL THEORYAND POLICY ANALYSIS http://www.indiana.edu/~workshop/

38. International Union of Anthropological and Ethnological SciencesCommission on FolkLaw and Legal PluralismExecutive Secretary, Prof.Dr. Fons Strijbosch, c/o Institute of Folk Law, Catholic University, Postbus 9049, 6500 KK Nijmegen, the Netherlands. E-mail: F.Strijbosch@jur.kun.nlhttp://www.jur.kun.nl/cflp/

39. World Bank http://wbln0018.worldbank.org/Networks/ESSD/icdb.nsf/ D4856F112E805DF4852566C9007C27A6/ 5B758F21508127B585256778004D0405

40. http://www.fao.org/sd/IN1_en.htm