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/lp/american-economic-association/status-quo-property-protection-in-politico-legal-systems-Be5OOxfVse
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- Publisher
- American Economic Association
- Copyright
- Copyright © 2023 © American Economic Association
- ISSN
- 2640-205X
- eISSN
- 2640-2068
- DOI
- 10.1257/aeri.20220091
- Publisher site
- See Article on Publisher Site
Abstract
AbstractThis paper models status quo (SQ) protection of property rights. A politico-legal system determines eligibility of citizen groups for protection. A ruling authority can reallocate property if and only if reallocation is preferable to the status quo for one such group. Along the solution path, SQ protections distort allocations across different assets and different property owners. Asset distortions vanish in the limit as the path converges to a stationary assignment. Ownership distortions vanish in the limit if no individuals belong to every eligible group. If the authority is self-interested, systemic protection of vulnerable groups may be welfare improving. (JEL D72, H13, K11, P14)
Journal
American Economic Review Insights – American Economic Association
Published: Jun 1, 2023