ABOUT THIS BOOK
Governments and development agencies spend considerable resources building property and company registries to protect property rights. When these efforts succeed, owners feel secure enough to invest in their property and banks are able use it as collateral for credit. Similarly, firms prosper when entrepreneurs can transform their firms into legal entities and thus contract more safely. Unfortunately, developing registries is harder than it may seem to observers, especially in developed countries, where registries are often taken for granted. As a result, policies in this area usually disappoint.
Benito Arruñada aims to avoid such failures by deepening our understanding of both the value of registries and the organizational requirements for constructing them. Presenting a theory of how registries strengthen property rights and reduce transaction costs, he analyzes the major trade-offs and proposes principles for successfully building registries in countries at different stages of development. Arruñada focuses on land and company registries, explaining the difficulties they face, including current challenges like the subprime mortgage crisis in the United States and the dubious efforts made in developing countries toward universal land titling. Broadening the account, he extends his analytical framework to other registries, including intellectual property and organized exchanges of financial derivatives. With its nuanced presentation of the theoretical and practical implications, Institutional Foundations of Impersonal Exchange significantly expands our understanding of how public registries facilitate economic growth.
TABLE OF CONTENTS
List of Illustrations
Acknowledgments
Introduction - Benito Arruñada
DOI: 10.7208/chicago/9780226028354.003.0009
[property titles, business formalization policies, public registry, transaction costs, impersonal trade]
This introductory chapter begins with discussions of misguided property titling and business formalization policies, and how public registries reduce the transaction costs of impersonal trade. It then describes the book's organization and methodology and exposition. (pages 1 - 14)
This chapter is available at:
https://academic.oup.com/chica...
The Role of Verifiable Contract Publicity in Impersonal Trade - Benito Arruñada
DOI: 10.7208/chicago/9780226028354.003.0001
[public contract formalization, impersonal exchange, rights on assets, rights on persons, economic agency, enforcement, transaction costs]
This chapter presents a general theory of public contract formalization. It discusses how impersonal exchange requires rights on assets; the difference between rights on assets and rights on persons; the differences between the economic and legal views on enforcement; and how multiple rights are indispensable for specialization and are pervasive in today's economies. The chapter then considers the sequential structure of transactions, using an economic agency framework in order to clarify how rights are recurrently allocated and show that the interaction between enforcement benefits and transaction costs is widespread various economic transactions. (pages 15 - 42)
This chapter is available at:
https://academic.oup.com/chica...
Institutions for Facilitating Property Transactions - Benito Arruñada
DOI: 10.7208/chicago/9780226028354.003.0002
[impersonal markets, land registries, private transactions, public titling, deeds, registration of rights, land titling]
This chapter examines how functional land registries enable impersonal markets. Starting with the regime of purely private transactions, it focuses on the main public titling solutions in use today: the recordation of deeds with or without title insurance, found in the United States and France, respectively, and the registration of rights available, for instance, in Australia, England, Germany, and Spain. (pages 43 - 75)
This chapter is available at:
https://academic.oup.com/chica...
Institutions for Facilitating Business Transactions - Benito Arruñada
DOI: 10.7208/chicago/9780226028354.003.0003
[contract rules, corporate contracts, business transactions, independent publicity]
This chapter explains how independent registration of originative contracts and legal acts allows courts to apply market-friendly contract rules when settling disputes on subsequent corporate contracts with third parties. It begins by examining why contract rules are needed in business transactions, emphasizing the common structure of the information problem and the prevalent solutions adopted in the three areas of movable property, agency, and corporations. The chapter then explores how the verifiable evidence needed to efficiently apply contract rules can be produced by different means in these three areas and establishes a common requirement: independent publicity. (pages 76 - 107)
This chapter is available at:
https://academic.oup.com/chica...
Strategic Issues for Creating Contractual Registries - Benito Arruñada
DOI: 10.7208/chicago/9780226028354.003.0004
[contracts, legal orders, impersonal trade, registry services, property titling, business formalization]
This chapter addresses the strategic issues for creating contractual registries. These include understanding conflict between local and wider legal orders; the most logical sequence in developing institutions for impersonal trade; priorities for reform; lessons learned from reforms in the areas of property titling; and reforms in business formalization. (pages 108 - 131)
This chapter is available at:
https://academic.oup.com/chica...
The Choice of Title and Registration Systems - Benito Arruñada
DOI: 10.7208/chicago/9780226028354.003.0005
[design choices, registries, private titling, public tilting, voluntary titling, universal titling, recordation of deeds, registration of rights, business registration]
This chapter considers the main design choices for registries. It examines the decision whether to create a public titling system or to rely exclusively on private titling; the choice between voluntary and universal titling; the theoretical and empirical consideration of recordation of deeds and registration of rights; and the mostly parallel choices for business registration. (pages 132 - 167)
This chapter is available at:
https://academic.oup.com/chica...
Conveyancing and Documentary Formalization - Benito Arruñada
DOI: 10.7208/chicago/9780226028354.003.0006
[conveyancing services, registries, conveyancers, titling systems, title insurance, credit insurance]
This chapter analyzes the nature of conveyancing services and their interactions with registries, and outlines a proposal for regulating conveyancing and other complementary services. The discussions cover the palliative nature of documentary formalization; the role of conveyancers in each titling system; market-driven changes in the conveyancing industry; regulation of conveyancing services in the twenty-first century; and the role of title and credit insurance. (pages 168 - 192)
This chapter is available at:
https://academic.oup.com/chica...
Organizational Challenges - Benito Arruñada
DOI: 10.7208/chicago/9780226028354.003.0007
[information systems, formalization, contractual registries, administrative registries, public registries]
This chapter discusses the following: the use of information and the design of information systems for sensible decision making; the synergies and risks of integrating contractual and administrative formalization; the challenges posed by technical changes in information technology; the need to apply strong incentives in the organization of public registries; and the importance of considering the self-interests of all participants and managing these by means of counterbalancing incentives. (pages 193 - 228)
This chapter is available at:
https://academic.oup.com/chica...
Concluding Remarks - Benito Arruñada
DOI: 10.7208/chicago/9780226028354.003.0008
[public registries, property registries, business registries, transactions costs]
This chapter summarizes the book's main arguments. It discusses the value of functional property and business registries as market facilitators. These are costly and fragile institutions that must be well designed and wisely managed in order to be effective in reducing transaction costs and thus make truly impersonal (that is, asset-based) exchange possible. The chapter also looks into the challenge of public registries. (pages 229 - 234)
This chapter is available at:
https://academic.oup.com/chica...
Notes
References
Index
