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Stake, Jeffrey Evans --- "Decomposition of Property Rights" [2010] ELECD 383; in Bouckaert, Boudewijn (ed), "Property Law and Economics" (Edward Elgar Publishing, 2010)

Book Title: Property Law and Economics

Editor(s): Bouckaert, Boudewijn

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781847205650

Section: Chapter 6

Section Title: Decomposition of Property Rights

Author(s): Stake, Jeffrey Evans

Number of pages: 35

Extract:

6 Decomposition of property rights
Jeffrey Evans Stake


1. Introduction
In light of the importance of property to the economic system and the tre-
mendous attention to transaction costs since Coase (1960), it seems some-
what odd that the particular rules of English property law, which impose
costs on land transactions, have received relatively little attention from
economists. Perhaps this is because the English common-law system of
property rules is both high enough in flexibility and generally low enough
in administrative costs that it causes no large and obvious drag on com-
merce. Nevertheless, the rules governing subdivision or decomposition
of property rights have received some attention from law and economics
scholars (e.g., Shavell 2004, pp. 27­32). The purpose of this chapter is
to review some of the literature relating to ways in which rights in land
and other assets can be divided and suggest explanations for existing
decompositions of property.
Economics and property law meet in at least two fundamentally differ-
ent ways. In the standard analysis, researchers have attempted to deter-
mine the allocative and welfare effects of various legal rules and regimes.
Both economists and lawyers have, in a positive vein, tried to explain and
predict behavior of individuals and, in a normative vein, criticized the law
and proposed reforms based on those predicted behaviors (e.g., Epstein
1982; Hirsch 1983). Second, economic analysis has occasionally (Posner
2007; Krier 1974) been used to explain the behavior of judges and, in so
doing, to clarify ...