Property Rights and Residential Investment: Evidence from Post-Apartheid South Africa

While economists agree that property rights are important for economic growth, it is still unclear which component of property rights matters the most for development and how much formalizing property rights matters in contexts where informal rights are present to some extent. Understanding the role of formal property rights has policy implications for many developing countries where state-enforced protections for private property are most limited. This paper uses administrative data in a difference-in-differences design to estimate the effect of a nonprofit property titling program on residential investments in South Africa, a context where residents have occupation rights and receive transaction rights via title deeds.