How Efficient is Urban Land Speculation?

Abstract

Urban land speculation presents planning challenges of contemporary urbanization and settlements worldwide. Studies concerning land speculation focus primarily on the Global North and Asia, while little has been done on Sub-Saharan Africa. Available research in Sub-Saharan Africa is largely confined to studying economic forces driving peri-urbanization, land markets, and informal influences. Few have explicitly examined the policy forces driving it. Urban areas in Ethiopia have been growing very quickly in recent decades, which have led to ever-increasing demand for land in peri-urban and urban areas for housing and other non-agricultural activities. This has had several transformative impacts on transitional peri-urban areas, including engulfment of local communities and conversion of land rights and use from an agricultural to a built-up property rights system. Peri-urban areas also compete for land among speculators of diverse backgrounds. This chapter analyzes the urbanization and policy forces driving land speculation, economic role of land speculators, opportunity of land speculation and motives behind land speculation in the city of Shashemene, Ethiopia. It scrutinizes the city’s urbanization policy and national land policy by investigating how and why they are linked with the city’s land speculation processes. The analyses utilize primary data collected through household surveys, field observations, and key informant interviews, which are complemented by secondary data from national legal and policy documents, and regional and city administrative reports. The chapter encompasses an attempt to discover the process of land speculation in peri-urban and urban land by looking at the principal actors involved in land speculation. A principle finding illustrates that the societal costs in a typical city are increased by about 5–11% as a result of speculative increases in the value of urban land.