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Titles for me but not for thee: transitional gains trap of property rights extension in Colombia

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Abstract

I apply Tullock’s transitional gains trap to the formalization of property titles in Latin America to understand public choice problems in mending institutions. In an area where land is owned by formal and informal institutions, policies to extend property rights will not be supported by voters holding legal title because it will devalue their property. To test this I use data from Colombia where a peace deal to end a 50-year conflict with Revolutionary Armed Forces of Colombia rebels was reached in 2016 and put to a public referendum. The deal included formalization of property titles across the nation as well as an end to the conflict. Using municipal-level data on voting and property ownership and controlling for conflict history, I find potential losses to formal property holders pushed median voter preferences toward dissension. A 1% increase in legally titled land increases dissenting vote share by 3% points. These results are relevant to institutional reforms anywhere with corrupted property rights.

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Fig. 1

Fitted lines show semi-parametric relationship between the independent variable and no-vote share

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Notes

  1. This is the case in Colombia where there is a mixture of formal land registration and informal property proprietorship.

  2. This requires the reasonable assumption that officials and their constituents are more likely to be formal property holders.

  3. Assuming that titling informal land will have no effect on demand for formal land.

  4. Ultimately, several terms were renegotiated and the final peace accord was pushed through the Colombian Parliament and did not see a referendum ballot.

  5. In Colombia, municipalities are similar to US counties.

  6. In particular, many of these zones are designed to represent internally displaced persons, a community in which FARC is very unpopular.

  7. Colombia has an intriguing history of minimal punishment for rebellion. The sentence for armed rebellion was 3–6 years in the penal code for much of the twentieth century (Robinson 2016).

  8. The slogan for Uribe’s no-vote campaign was “we want peace, but not this peace” stating demands for stiffer punishment of FARC rebels. However, it is important to note that as president, Uribe granted amnesty to 6000 right-wing paramilitaries guilty of many atrocities during the course of the Colombian conflict.

  9. See Leech (2011) and Richani (2013) for further discussion of FARC’s growth in the drug trade.

  10. This was a frequent reason given by no voters for their lack of support.

  11. See Tullock (1975) for further discussion.

  12. One may be concerned with co-linearity between informal land estimates and legal ownership. Omitting informal ownership does not affect the legal title variables. State land is not included.

  13. This is only a problem if there is something unique about land ownership status that determines political preferences beyond the included demographic controls, particularly income, poverty rate, population, and rural population percentage.

  14. Presumably a voter would cast a ballot for Santos in 2014 if they supported the continuation of the peace negotiations, or another candidate if they did not.

  15. Uribe continued and intensified the aforementioned Plan Colombia as president.

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Acknowledgements

The author would like to thank Josh Hall, Bryan McCannon, Lynne Kiesling, Bonnie Wilson, Michael Munger, two anonymous referees, and many helpful insights from commenters at Public Choice Society, Southern Economic Association, and American Institute of Economic Research meetings and the Universidad de Los Andes CEDE for data assistance.

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  1. West Virginia University, 1601 University Ave, Morgantown, WV, USA

    Perry Ferrell

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Correspondence to Perry Ferrell.

Appendix

Appendix

See Tables 5, 6, and 7.

Table 5 Summary Statistics for FARC Violence, annual averages (N=914)
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Table 6 Voting models controlling for FARC violence
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Table 7 Demographic and Violence Controls for Voting controlling for overall violence (Table 3)
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Ferrell, P. Titles for me but not for thee: transitional gains trap of property rights extension in Colombia. Public Choice 178, 95–114 (2019). https://doi.org/10.1007/s11127-018-0617-2

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