2009/05/01 by Randall Akee · 1 citation
Economics, Econometrics and Finance · Agricultural and Biological Sciences · Social Sciences · #Housing Market and Economics #Land Rights and Reforms #Urban and Rural Development Challenges #Coase theorem #Reservation #Yard #Investment (military) #Stumpage #Tribe #Property rights #Real estate #Economics #Government (linguistics) #Database transaction #Land tenure #Natural resource economics #Business #Easement #Agricultural economics #Transaction cost #Finance #Geography #Microeconomics #Law #Political science #Archaeology
paper · doi:10.1086/592718
openalex publication_date 2009/05/01 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/30
In the late 1800s, Palm Springs, California, was evenly divided into 1‐mile‐square blocks—like a checkerboard—and property rights were assigned in alternating blocks to the Agua Caliente tribe and a non‐Indian landowner by the U.S. federal government. The quasi‐experimental nature of land assignment holds land quality constant across the two types of landowners. Sales, mortgaging, and leasing restrictions on the Agua Caliente Reservation land created large transaction costs to development on those lands; consequently, there was very little housing investment. The non‐Indian blocks, which were extensively developed, provide a benchmark for efficient outcomes for the Agua Caliente lands. Once the restrictions on Agua Caliente lands were relaxed in 1959, the number of homes and real estate values converged to those of non‐Indian‐owned lands as predicted by the Coase theorem.