2019
DOI: 10.1007/s11698-019-00196-9
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Land rights, local financial development and industrial activity: evidence from Flanders (nineteenth–early twentieth century)

Abstract: In this paper, we investigate the hypothesis that the economic divergence across Flemish localities between 1830 and 1910 is explained by the theory of Hernando de Soto. We hypothesize that the uniform land rights installed after the French revolution provided borrowers with an attractive form of collateral. Conditional on the presence of local financial development provided by a new government-owned bank this eased access to external finance and fostered industrial and commercial economic activity. Using prim… Show more

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Cited by 3 publications
(2 citation statements)
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“…Third, the introduction of formalized land rights might have created the possibility for villagers to use land as collateral and so increased participants' access to the credit market. This, in turn, could have facilitated market transactions with unknown strangers and it could have determined the increase in outgroup cooperation (Devijlder & Schoors, 2019). I test whether controlling for different measures of market integration, such as the share of calories purchased in markets and distance from markets, capture the observed increase in out-group contribution.…”
Section: Data Analysesmentioning
confidence: 99%
“…Third, the introduction of formalized land rights might have created the possibility for villagers to use land as collateral and so increased participants' access to the credit market. This, in turn, could have facilitated market transactions with unknown strangers and it could have determined the increase in outgroup cooperation (Devijlder & Schoors, 2019). I test whether controlling for different measures of market integration, such as the share of calories purchased in markets and distance from markets, capture the observed increase in out-group contribution.…”
Section: Data Analysesmentioning
confidence: 99%
“…This study contributes to several research strands: First, although there is ample evidence of land and credit linkages at the macro level, to the best of our knowledge ours is the first study to document the credit-and land-market activation effects of land titling at the parcel level. Historically, the type of land rights and land ownership structure affected the evolution of cooperative credit institutions (Suesse & Wolf 2020), financial system operation (Rajan & Ramcharan 2011), real estate cycles (Rajan & Ramcharan 2015), and long-term development (Devijlder & Schoors 2020). 2 On U.S. Indian reservations, credit access has been identified as the main channel that supported greater development on parcels with fully, compared to only partially transferable property rights (Dippel et al 2020).…”
Section: Introductionmentioning
confidence: 99%