GDN is an international organization that brings together researchers and research institutes from developing and transition countries. Its annual conferences provide a forum for discussion on issues of sustainable development and poverty reduction. Participants include Nobel laureates, internationally renowned researchers, heads of government, and representatives of national and international organizations.
Regarding his award-winning work, Dr. Gandelman states that “governments in many developing countries have implemented land titling programs that consist of granting property rights to land or housing occupants. For example, this occurs when an informal settlement is formalized (the so-called cantegriles in Uruguay or villas miserias in Argentina) or when housing units or housing solutions are provided. In the award-winning paper, I argue that there are two effects similar to what economists call the income effect and the substitution effect. The income or wealth effect is that, as people become wealthier and/or have higher incomes, they tend to demand more of all goods, including home maintenance, education, and healthcare. In this case, the substitution effect occurs because land titling makes it more convenient to maintain the home, since the risk of expropriation has been eliminated. The flip side of this is that there are other areas where people will tend to invest less. If those areas include their children’s education and health, the effect of land titling programs on future generations is not necessarily positive."
The article illustrates this argument with a theoretical model and presents data from a natural experiment that took place in Uruguay, which allowed for testing the effects of land titling. “It is verified that land titling is associated with greater investment in housing and, in some respects, with lower investment in children’s education and health,” the author concludes.