Indian land fractionation

New Scholarship on Property Institutions and Income Dissipation in Indian Country

Matthew L.M. Fletcher

Jacob Russ and Thomas Stratman have posted “Missing Sticks: Property Institutions and Income Dissipation in Indian Country” on SSRN.

Here is the abstract:

This paper analyzes the economic consequences of property institutions. Federal land reform policy privatized American Indian reservation land in the 1880s. This reform intended to foster economic development on American Indian reservations by creating a system of individual private property. However, these new ownership rights were incomplete and accompanied by restrictions that have led to the fragmentation of land parcels into millions of shared ownership claims. Because land rights on Indian reservations do not include all of the sticks in the traditional property rights bundle, Indians face higher costs for real estate transactions. These additional costs preclude exchange and impede the productive use of reservation-land resources. Using data on Indian land ownership and agricultural leases in 2010, we provide the first quantitative evidence that incomplete property rights have worsened economic outcomes on Indian reservations. Our results show that increased ownership fractionation has reduced the incomes of American Indians on reservations and is associated with lower agricultural lease income, a measure of land productivity.

Jessica Shoemaker on the Indian Land Tenure Problem

Matthew L.M. Fletcher2 Comments

Jessica Shoemaker has posted “No Sticks in My Bundle: Rethinking the Indian Land Tenure Problem,” forthcoming in the Kansas Law Review.

Here is the abstract:

This article analyzes the modern rule that individual Indian co-owners of allotted land retain no direct rights to use and possess their own property without a lease or other prior permission from their co-owners. This special Indian no-use and no-possession rule is of a relatively recent vintage, and it is contrary to the rights of co-owners in nearly every non-Indian jurisdiction. This rule is also ahistorical and contrary to current federal policy to promote Indian use of Indian land. While other scholarship on Indian land tenure has focused on the practical challenges of coordinating among so many co-owners in Indian lands’ fractionated state and on the limits imposed by the federal trust status’s alienation restraints on these lands, this article argues that the lack of legal possession and use rights for Indian co-owners is a third and previously overlooked factor in the problem of Indian self-determination. This article ultimately concludes that the federal co-ownership rules for individual Indian lands are poorly designed and are exacerbating other land tenure and social and economic problems in Indian Country. This article ultimately proposes tribally driven solutions to create a more rational and culturally congruent property system for indigenous people.

New Empirical Study on Indian Land Fractionation on 12 Reservations

Matthew L.M. Fletcher1 Comment

Jacob W. Russ & Thomas Stratmann have posted “Creeping Normalcy: Fractionation of Indian Land Ownership” on SSRN.

Here is the abstract:

In 1992 the General Accounting Office (GAO) published a quantitative survey of Indian land ownership of twelve reservations, which was the first and still is the only survey of Indian land ownership. In our study we use 2010 data to show how ownership fractionation for these reservations has changed since the original GAO study. We find that, despite the whole of Congressional action regarding land fractionation, and the US Bureau of Indian Affairs’ (BIA’s) land consolidation programs, fractionation has not only continued, but BIA’s complex recordkeeping workload has nearly doubled for the twelve reservations over the eighteen year interval. The GAO estimated that BIA’s annual recordkeeping costs for these twelve reservations was between $40 and $50 million. With the addition of over a million new ownership records, due to fractionation, we estimate yearly recordkeeping costs have increased to $246 million in 2010.