Incomplete Property Rights and Farm Size: Evidence from Haiti

Abstract

We investigate the connection between incomplete property rights and plot size. Incomplete property rights create transaction costs in the land market, which should have two effects on plot size: transaction costs (1) decrease plot size and (2) increase the variation in plot sizes. We test these hypotheses using newly collected archival data from Haiti. We measure incomplete property rights using Haiti’s tradition of families jointly owning land and find that the patterns in the data are consistent with these property rights creating large transaction costs in the land market. These results inform the discussion of small farms around the developing world and of Haiti’s economic development.