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Asymmetric Information and the Law of Servitudes Governing Land

Journal of Legal Studies, Forthcoming

36 Pages Posted: 6 Jun 2011  

Antony Dnes

Hull University Business School (HUBS)

Dean Lueck

Indiana University Bloomington - The Vincent and Elinor Ostrom Workshop in Political Theory & Policy Analysis; Indiana University

Date Written: January 1, 2009

Abstract

This paper explains the structure of the law governing servitudes on land using key ideas from the economics of information, focusing on easements and covenants and the rules governing their formation and application. We develop a model of land markets that incorporates asymmetric information (adverse selection) and specialization in ownership and use this to offer a rationale for the seemingly ad hoc limits on the use of servitudes. We stress the inability of sellers of land
credibly to assure buyers that land is not encumbered by servitudes. Our model explains variations in legal doctrine over time and across jurisdictions, particularly comparing servitudes in the United States and in England.

Keywords: law and economics, property rights, servitudes

JEL Classification: K0, K11

Suggested Citation

Dnes, Antony and Lueck, Dean, Asymmetric Information and the Law of Servitudes Governing Land (January 1, 2009). Journal of Legal Studies, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1858680

Antony Dnes (Contact Author)

Hull University Business School (HUBS) ( email )

Hull, HU6 7RX
United Kingdom
44-1482-465875 (Phone)
44-1482-466216 (Fax)

Dean Lueck

Indiana University Bloomington - The Vincent and Elinor Ostrom Workshop in Political Theory & Policy Analysis ( email )

513 N. Park Avenue
Bloomington, IN 47408–3895
United States

HOME PAGE: http://https://ostromworkshop.indiana.edu/people/directors/lueck-dean.html

Indiana University ( email )

107 S Indiana Ave
100 South Woodlawn
Bloomington, IN 47405
United States

HOME PAGE: http://https://economics.indiana.edu/home/people/lueck/

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