Our research investigates the relationship between government-administered cadastres and economic growth using a novel dataset on variation in cadastres within countries’ contemporary borders. We define a cadastre as a public record describing a land asset, the party that owns it, and their rights, restrictions, and responsibilities over the asset. Our dataset documents the timing of the adoption of cadastres, the quality of cadastres, and the extent of cadastres for 159 countries between 1000 and 2015. These countries include China, whose comprehensive cadastral records were already in existence in 1000; Vietnam, which enacted cadastral reform in the 1470s; Sweden, which enacted cadastral reform in the 1530s; and contemporary countries such as the Republic of the Congo, Turkmenistan, and Haiti, which by 2015 still had no cadastre. Our dataset also documents reversals where existing cadastral institutions have been either purposefully abandoned—as in the Ottoman Empire (ca. 1600) or Russia (ca. 1650)—or destroyed in conflict—as in Cambodia and Laos in the 1970s. Our data include fiscal cadastres, established for taxation, and legal cadastres, which focus on recording property rights.
Our research finds that cadastres consistently contribute to economic growth. Specifically, between 1950 and 2015, a transition from no cadastral system to a full cadastre (i.e., a mapped cadastre covering the entire territory of the country) was associated with an immediate 2.86 percentage point increase in the level of gross domestic product (GDP) per capita. Our estimates imply that a typical, more moderate cadastral reform immediately increased GDP per capita by 0.86 percent. Generally, the positive association between cadastres and economic growth was strongest in Europe and Africa.
Cadastres can contribute to economic growth for several reasons. Formalizing property rights allows land assets to be used as collateral in credit applications, providing stronger security to creditors and increasing their willingness to supply credit. Formalization may also increase landowners’ confidence that public authorities will not confiscate their assets and that neighbors will respect boundaries, thus boosting consumption and investment in physical capital. Furthermore, it might induce less productive landowners to sell their land or temporarily move to urban areas for employment.
Additionally, cadastres contain authoritative information about the assignment of property rights to land, and government-administered cadastres make this information publicly available. This information is particularly important for the sale of assets as it identifies the seller and clarifies to buyers whether there are claims on the property. While landowners can be known locally without a cadastre, government-administered cadastres make this information more readily available to all people, enabling more efficient economic exchanges between strangers on a large scale.
Also, cadastres may impact economic growth through their effect on governments’ capacity to tax and thus provide public goods. Governments have often established cadastres for fiscal purposes. Examples include the cutting-board registers in China in 1143, the Napoleonic cadastres of the early 19th century, and urban cadastres in contemporary Latin America. Cadastres improve governments’ ability to tax by furnishing authorities with reliable information on taxable assets and the relevant taxpayer.
Using the World Bank’s Registering Property dataset, our research finds that cadastres had a negative relation with the cost and number of procedures and days associated with property registration among 149 countries between 2005 and 2015. A typical cadastral reform resulted in about 29 fewer days of waiting for a registration certificate. Furthermore, our findings suggest, somewhat surprisingly, that the strength of cadastral institutions does not appear to impact property or income tax revenue but strongly increases consumption tax revenue. One plausible explanation for this finding is that cadastral reforms effectively increase households’ wealth, boosting consumption and the formalization of businesses, both of which increase consumption tax revenue. Finally, our findings suggest that the role of cadastres in clarifying property rights and facilitating transactions is more important for economic growth than their effect on expanding property owners’ access to credit.
Identifying the effect of cadastral reforms on economic growth is challenging. Governments may introduce cadastres as part of a large package of reforms or after a crisis when GDP levels are already recovering. This is the case in our more detailed, individual analyses of France, Italy, the Netherlands, Portugal, Sweden, and the United Kingdom. Thus, we cannot rule out the possibility that our estimate of the impact of cadastral reforms may, to some extent, capture general recovery effects from crises. We interpret the correlation between cadastres and economic development as suggestive but not definitive evidence of a causal effect. We hope our work paves the way for further research and a deeper understanding of the relationship between property rights and macroeconomic development.
