Zackary Hawley, Juan José Miranda, and W. Charles Sawyer
This research studies land values and the associated property tax implications of formal property rights, informal property rights, and squatting. Using the Peruvian Living Standards Measurement Survey data from 2007 to 2012, the research provides estimates of the land value and property tax losses associated with property rights and squatting. We use a hedonic model to obtain these estimates which are then used to provide the implied value of property taxes that are not being collected as a result of informal property rights. The policy implications of the results suggest improved methods for property right assignment that would led to enhanced property tax collections that may lead to funds for the provision of infrastructure in the affected communities.