Yun-chien Chang

An Empirical Study of Compensation Paid in Eminent Domain Settlements: New York City, 1990–2002

No large‐scale empirical study on condemnation compensation has been done in the past 30 years. Several state legislatures, in response to Kelo v. City of New London, have changed laws to increase condemnation compensation, despite the lack of empirical grounds. To fill in the empirical gap, I use hedonic regression models and about 80,000 sales to estimate the fair market value (FMV) of 430 condemned properties whose owners reached compensation settlements with the condemnor, New York City, between 1990 and 2002. More than 50 percent of these condemnees were compensated with less than FMV, about 40 percent received more than FMV, and less than 10 percent received FMV. Owners of residential properties and nonresidential properties alike often received extreme compensations that are less than 50 percent or more than 150 percent of FMV. Extreme compensation results from bias‐prone and inaccurate appraisal methods. Using the available data, I find that compensation level does not correlate with any factor.

Economic Value or Fair Market Value: What Form of Takings Compensation Is Efficient?

The scholarly literature on takings compensation emphasizes incentives for condemnors and condemnees. The widely accepted prediction that full compensation leads to overinvestment by condemnees, however, is not based on the correct understanding of the takings law in the United States. Condemnors are often assumed to be social wealth maximizers or to suffer from fiscal illusion, both theories lacking empirical support. In addition, costs and accuracy of assessing property value for takings compensation purposes are important, yet have never been systematically analyzed. I argue that owners will generally invest efficiently if either economic value or fair market value (assessed under current U.S. law) is adopted as the takings compensation standard. Government officials seek to maximize their own political interests, not their agencys or societys interests, when making decisions on condemnations. If only condemnors’ and condemnees’ incentives are considered, economic value compensation is the most effic...

Condominium Law in Taiwan: Doctrinal Overview Under the Lens of Information-Cost Theory

Abstract This article describes the law relating to condominiums (‘condominium law’) in Taiwan, a densely populated country with many people residing in apartments. The Condominium Administration Act and Taiwan Civil Code are the major sources of the law, in addition to various land use regulations and court precedents. Several features and problems stand out among the intricate web of condominium law. First, the law gives condominium bylaws spacious room to supersede the default rules set by statutes, yet condominium bylaws are merely available upon request and need not be registered. Second, since day one it has been unclear whether a condominium association (or a condominium board) has juridical personality and who owns the common fund. Courts and scholars still differ as to what the judicial and legislative solutions are. Third, apartment owners and condominium boards have used courts as a viable dispute-resolution mechanism. Condominium boards have successfully evicted unneighbourly inhabitants and have even forced uncooperative apartment owners to sell their titles. Apartment owners, on the other hand, have persuaded courts to vacate unfair condominium bylaws.

Private Property and Takings Compensation

This innovative volume offers a thorough breakdown of the issues surrounding takings compensation – payments made as reimbursement for government takeover of private property. Using examples from New York City and Taiwan, Yun-chien Chang discusses the advantages and disadvantages of different methods of compensation and offers insightful suggestions for future implementation.

An Economic and Comparative Analysis of Specificatio (The Accession Doctrine)

The accession doctrine (specificatio in Roman law) in property law exists in both common law and civil law, but its specific content differs across the two: the common law disallows bad-faith improvers to gain title, while the civil law generally does not distinguish between good faith and bad faith. There are two tests in transferring title, the transformation test and the disparity-of-value test. France stipulates one test; the US requires either test to be satisfied; and Germany requires both. Furthermore, not all jurisdictions award compensation to unauthorized improvers who do not gain title. The prior literature has not explored, in detail, under what conditions the accession doctrine is most efficient, nor which version of the doctrine is economically superior. This article argues that the accession doctrine is most likely to be welfare-enhancing if designed in the following ways: improvers have to conduct cost-justified verification so that bad-faith and negligently good-faith improvers do not gain title to the chattel in question. Both the transformation test and the disparity-of-value test have to be satisfied. The original owner has no duty to compensate the improver for her labor. Copyright Springer Science+Business Media New York 2015

Access to Landlocked Land: A Case for a Hybrid of Property and Liability Rules

Access to landlocked land is a universal legal entanglement, but surprisingly no law and economic scholars have systematically analyzed this issue. The doctrines in the U.S., called “easements of necessity” and “statutory easements,” are similar to those in civil-law jurisdictions, and they have intuitive appeals: as for statutory easements, owners of servient land should be compensated; easements should be necessary; and the location of the passage should cause the least damage to the servient land. As for easements of necessity, the landlocked owners can only gain access over land held by the grantor at the time of the conveyance, and the easements are gratuitous. Using economic analysis, this article argues that these doctrines can be understood as an application of what I call “hybrid rule,” an unheralded mixture of the property rule and liability rule. This hybrid rule is more efficient than the two prototypical entitlement protection rules because it facilitates voluntary transactions between landlocked owners and owners of servient land and reduces cost externalization. More specifically, the hybrid rule stipulates that the extent of statutory easements should be set at where the marginal social benefit of prescribed passage is about to sharply decline, and passage locations should be determined following the least damage rule. As for easements of necessity, the limited access rule and the gratuity requirement make economic sense from an ex ante viewpoint.