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Property rights and economic development: the legacy of Japanese colonial institutions

Published online by Cambridge University Press:  18 March 2016

DONGWOO YOO  and
RICHARD H. STECKEL
DONGWOO YOO*
Affiliation:
Department of Economics, West Virginia University, Morgantown, WV, USA
RICHARD H. STECKEL*
Affiliation:
Department of Economics, The Ohio State University, Columbus, OH, USA
*
*Email: dongwoo.yoo@mail.wvu.edu
**Email: steckel.1@osu.edu
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Abstract

Several studies link development to institutions transplanted by European colonizers and here we extend this line of research to Asia. Japan imposed its system of well-defined property rights on some of its Asian colonies. In 1939, Japan began to register private land in its island colonies, an effort that was completed in Palau but interrupted elsewhere by World War II. Within Micronesia, robust economic development followed only in Palau where individual property rights were well defined. We show that well-defined property rights in Korea and Taiwan secured land taxation and enabled farmers to obtain bank loans for irrigation systems. Considering Japanese colonies, we use the presence or absence of a land survey as an instrument to identify the causal impact of new institutions. Our estimates show that property-defining institutions were important for economic development, results that are confirmed when using a similar approach with British Colonies in Asia.

Type
Research Article
Information
Journal of Institutional Economics , Volume 12 , Issue 3 , September 2016 , pp. 623 - 650
Copyright
Copyright © Millennium Economics Ltd 2016 

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