The Mythology of Holdout as a Justification for Eminent Domain and Public Provision
نویسنده
چکیده
One of the alleged justifications for government provision of roads is that the power of eminent domain is necessary in order to overcome holdout problems and obtain right-of-way properties (Goldstein 1987).1 After all, this argument continues, only the state has such power, so the private sector would be unable to supply the efficient amount of roads.2 In this article, I examine this market-failure justification for public roads from three different perspectives and demon-
منابع مشابه
A Bargaining Model of Holdouts and Takings
The holdout problem is commonly cited as the justification for eminent domain, but the nature of the problem is not well understood. This paper models the holdout problem in a bargaining framework, where a developer seeks to acquire several parcels of land for a large-scale development. We show that in the absence of eminent domain, holdouts are inevitable, threatening costly delay. However, if...
متن کاملpromotes efficiency by spreading the costs of takings on a broader set of property owners, similar to the effect of broadening a tax base to decrease deadweight loss of taxation
September 2011 this is a rough and incomplete first draft please do not distribute or quote Abstract: Recent theoretical work has demonstrated that holdout is the appropriate efficiency justification for eminent domain. In parallel, recent empirical work has demonstrated that state legislatures either grant discretion to local authorities, or constrain them from using eminent domain. This paper...
متن کاملThe Economics of Eminent Domain: Private Property, Public Use, and Just Compensation
Description: The Fifth Amendment of the U.S. Constitution reads "nor shall private property be taken for public use, without just compensation". Often referred to as the eminent domain or takings clause, economists have made significant contributions to the understanding of both the proper scope of takings and when compensation should be paid. The Economics of Eminent Domain: Private Property, ...
متن کاملThe “public Use” Requirement in Eminent Domain Law: a Rationale Based on Secret Purchases and Private Influence
This article provides a rationale for understanding and interpreting the “public use” requirement within eminent domain law. The rationale is based on two factors. First, whereas the government often needs the power of eminent domain to avoid the problem of strategic holdout, private parties are usually able to purchase property through the use of secret buying agents. The availability of secre...
متن کاملWho ’ s Holding Out ? An Experimental Study of the Benefits and Burdens of Eminent Domain
Eminent domain is widely considered a necessary tool to avoid seller holdout and ensure efficient land assembly. We conduct a series of laboratory experiments that challenge this conventional wisdom. We find that when there is no competition and no eminent domain, land assembly suffers from costly delay and failed assembly, resulting in participants losing 18.1% of the available surplus. Much o...
متن کامل