Eminent domain versus government purchase of land given imperpect information about owners' valuation
By: Steven Shavell
Contributors: National Bureau of Economic Research
Series: NBER working paper series -- working paper 13564; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 13564.
Publisher: National Bureau of Economic Research
Published: 2007
Place of publication: Cambridge, MA
Language: eng
Format: [electronic resource] /
Description: "Governments employ two basic policies for acquiring land: taking it through exercise of their power of eminent domain; and purchasing it.  The social desirability of these two policies is compared in a model in which the government's information about landowners' valuations is imperfect.  Under this assumption, the policy of purchase possesses the market test advantage that the government obtains land only if an owner's valuation is low enough that he is willing to sell it.  However, the policy suffers from a drawback when the land that the government needs is owned by many parties.  In that case, the government's acquisition will fail if any of the owners refuses to sell.  Hence, the policy of eminent domain becomes appealing if the number of owners of the land is large.  This conclusion holds regardless of whether the land that the government seeks is a parcel at a fixed location or instead may be located anywhere in a region"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 11/15/2007.

Includes bibliographical references.

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