The spatial sorting of informal dwellers in cities in developing countries: Theory and evidence

Harris Selod (1) , Lara Tobin (2, 3)

1 The World Bank - The World Bank
2 PSE - Paris School of Economics
3 PJSE - Paris Jourdan Sciences Economiques

We propose a theory of urban land use with endogenous property rights that applies to cities in developing countries. Households compete for where to live in the city and choose the property rights they purchase from a land administration which collects fees in inequitable ways. The model generates predictions regarding the levels and spatial patterns of residential informality in the city. Simulations show that land policies that reduce the size of the informal sector may adversely impact households in the formal sector through induced land price increases. Empirical evidence from a sub-Saharan African city supports the model's assumptions and outcomes.

Mots clés: Land markets; Property rights; Tenure security; Multiple sales

Domaines: Economies et finances

Harris Selod, Lara Tobin. The spatial sorting of informal dwellers in cities in developing countries: Theory and evidence. 2018. ⟨halshs-01703178⟩