Property Rights, Land Prices, and Investment: A Study of the Taiwanese Land Registration System

To evade land taxes, most land in Taiwan during the Ching Dynasty (1662-1895) was not registered. When the Japanese started to colonize Taiwan at the turn of the 20th century, a thorough land survey was made, and all surveyed land became registered. This paper studies how this institutional change affected land values and farmers' investment behavior. We find that land prices increased significantly after property rights became formally defined. Moreover, farmers became more willing to apply green fertilizers and to grow crops that took a long time to produce, such as tangerines. (JEL: K11, N55, Q15)