Date of Award

12-2012

Document Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Legacy Department

Economics

Advisor

DOUGAN, WILLIAM R.

Committee Member

TSUI , KEVIN K.

Committee Member

FLECK , ROBERT K.

Committee Member

HANSSEN , F. ANDREW

Abstract

ABSTRACT
Shortly after the Supreme Court's decision in Kelo vs. City of New London, which expanded the scope of eminent domain power, thirty-seven states enacted legislation to restrict their local governments' use of eminent domain. This paper uses a model of the efficient limitation on government discretion to explain (1) the initial responses of local government to Kelo and (2) the subsequent responses of state legislatures. It shows that elimination of the public-use doctrine is plausibly welfare reducing since it introduces additional uncertainty without offsetting expanded benefits. I test two predictions of the theoretical analysis: First, the post-Kelo actions of local governments indicate that they are inclined to use eminent domain frequently when it is allowed. Second, at a higher level of rule making - the state level in this case - there is a desire to rein in the use of eminent domain. The empirical evidence supports these predictions.
The second paper examines the impact of privatizing state-owned housing units on the development of a private market, focusing on price and quantity effects. I explore this issue in the context of China's 1994 housing reform in urban areas. I use the pre-reform public sector size as a source of cross-section variation to test the effects. The results suggest that the privatization reform allowed urban residents to increase their consumption of private housing, and led to an increase in the equilibrium purchase price. The positive effect on price suggests that privatization had larger effect on the demand than on the supply.
The third chapter examines the transaction of prohibited urban housing on rural land in China. Focusing on the supply side of rural residential land, this paper develops a theoretical framework that shows under the fragmented property regime regarding land in China, village council without many fiscal resources has incentive to turn rural residential land into urban housing use to grab rents, although it is not legally allowed. Following a perspective of paternalism, central government chooses to tolerate or restrict the sales of the prohibited housing, concerning the trade-off between agriculture output and fiscal tension among different government levels. Evidence is provided.

Included in

Economics Commons

Share

COinS