Monday, March 11, 2013

Property rights and the Arab Spring

Hernando de Soto is well known for his books about how a lack of property rights keeps the "Third world" countries back. His thesis is that because for example many people in the slums of those countries don't have good property rights for their houses (they built them themselves but on occupied ground) they cannot borrow money against their houses and for that reason they are not able to grow businesses.

Now he has written an article in the Wall Street Journal (The Secret to Reviving the Arab Spring's Promise: Property Rights) in which he claims that the problem plays in the Arab world too. He sees the problem of Mohamed Bouazizi, the Tunisian fruit vendor whose self immolation was the start of the uprisings as a property rights problem too given the ease with which he could be expropriated.

How to promote order and property rights under weak rule of law? discusses one approach: Mass education campaigns to promote alternative dispute resolution (ADR) are common examples. We study short-term impacts of one campaign in Liberia, where property disputes are endemic. From 246 towns, 86 were randomly provided training in ADR practices and norms, training 15% of adults. One year later, treated towns have higher resolution of land disputes and lower violence. Impacts spill over to untrained residents. We also see unintended consequences: more disagreements (mostly peaceful) and more extrajudicial punishment.

No comments: